Electricity – Photo by Markus Spiske from Pexels
(BRUSSELS) – The EU launched a consultation Monday on reform of Europe’s electricity market design to protect against price volatility, support access to secure clean energy, and make the market more resilient.
Since the summer of 2021, energy prices have seen unprecedented spikes and volatility, and have had a severe impact on EU households and the economy.
While the current system has delivered an efficient, well-integrated market for many years, according to the EU executive, allowing the EU to reap the economic benefits of a single energy market, the system has also demonstrated some shortcomings. In the current crisis of high and volatile electricity prices, the economic burden has been pushed on to final consumers.
The Commission says reform is needed to better shield households and businesses from high energy prices, to increase resilience, and to accelerate the transition set out in the European Green Deal and REPowerEU Plan.
Europeans, from large industrial consumers to SMEs and households, need to benefit from the growth and low operational costs of renewables. Guaranteeing direct access to affordable clean energy to all consumers will require market tools to achieve more stable prices and contracts based on the true costs of energy production.
The consultation launched today is expected to support the Commission’s work on a legislative proposal aimed to be delivered in the first quarter of this year. The consultation will run until 13 February and focuses on four main areas:
- Making electricity bills less dependent on short-term fossil fuel prices, and boosting the deployment of renewables;
- Improving market functioning to ensure security of supply, and fully utilise alternatives to gas, such as storage and demand response;
- Enhancing consumer protection and empowerment;
- Improving market transparency, surveillance and integrity.
Electricity market reform of the EU’s electricity market design – public consultation
