14

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Common rules for the internal electricity market

14-03-2019

On 30 November 2016, the European Commission presented a legislative proposal for a recast directive on the internal market for electricity, as part of a comprehensive legislative package entitled ‘Clean Energy for all Europeans’. The proposed directive would oblige Member States to ensure a more competitive, customer-centred, flexible and non-discriminatory EU electricity market with market-based supply prices. It would strengthen existing customer rights, introduce new ones and provide a framework ...

On 30 November 2016, the European Commission presented a legislative proposal for a recast directive on the internal market for electricity, as part of a comprehensive legislative package entitled ‘Clean Energy for all Europeans’. The proposed directive would oblige Member States to ensure a more competitive, customer-centred, flexible and non-discriminatory EU electricity market with market-based supply prices. It would strengthen existing customer rights, introduce new ones and provide a framework for energy communities. Member States would have to monitor and address energy poverty. The proposal clarifies the tasks of distribution system operators and emphasises the obligation of neighbouring national regulators to cooperate on issues of cross-border relevance. The Council adopted its general approach in December 2017. In the European Parliament, the Committee on Industry, Research and Energy (ITRE) adopted its report in February 2018. A provisional trilogue agreement was reached on 17 December 2018. Parliament is expected to vote on this agreement during the March II 2019 plenary session. Third edition. The ‘EU Legislation in Progress’ briefings are updated at key stages throughout the legislative procedure. Please note this document has been designed for on-line viewing.

Internal market for electricity

14-03-2019

On 30 November 2016, the European Commission presented a legislative proposal for a regulation on the internal market for electricity, as part of a comprehensive legislative package on the energy union. The proposed regulation is aimed at making the electricity market fit for more flexibility, decarbonisation and innovation, by providing for undistorted market signals. It sets out rules for electricity trading within different time frames, and clarifies the responsibilities of market actors. It defines ...

On 30 November 2016, the European Commission presented a legislative proposal for a regulation on the internal market for electricity, as part of a comprehensive legislative package on the energy union. The proposed regulation is aimed at making the electricity market fit for more flexibility, decarbonisation and innovation, by providing for undistorted market signals. It sets out rules for electricity trading within different time frames, and clarifies the responsibilities of market actors. It defines principles for assessing capacity needs at regional and European level and proposes design principles for market-based capacity mechanisms with cross-border participation. It introduces regional operational centres for handling-system operation and a European entity for distribution system operators. The Council adopted its general approach in December 2017. In the European Parliament, the Committee on Industry, Research and Energy (ITRE) adopted its report in February 2018. A provisional trilogue agreement was reached on 19 December 2018. Parliament is expected to vote on the agreement during the March II 2019 plenary session. Third edition. The ‘EU Legislation in Progress’ briefings are updated at key stages throughout the legislative procedure. Please note this document has been designed for on-line viewing.

New rules for the Agency for the Cooperation of Energy Regulators (ACER)

14-03-2019

On 30 November 2016, the European Commission presented a legislative proposal for a regulation on the Agency for the Cooperation of Energy Regulators (ACER), as part of the ‘clean energy for all Europeans’ legislative package. The proposed regulation recasts the legislation establishing the agency (Regulation (EC) No 713/2009), adapting it to changes in the energy markets and addressing the need for enhanced regional cooperation. It gives ACER a stronger role in the development of network codes and ...

On 30 November 2016, the European Commission presented a legislative proposal for a regulation on the Agency for the Cooperation of Energy Regulators (ACER), as part of the ‘clean energy for all Europeans’ legislative package. The proposed regulation recasts the legislation establishing the agency (Regulation (EC) No 713/2009), adapting it to changes in the energy markets and addressing the need for enhanced regional cooperation. It gives ACER a stronger role in the development of network codes and the coordination of regional decision-making. It furthermore assigns it a number of new tasks related to the regional operational centres that are to be established, the supervision of nominated electricity market operators and the assessment of generation adequacy and risk preparedness. In the European Parliament, the proposal has been referred to the Committee on Industry, Research and Energy (ITRE), which adopted its report in February 2018. A provisional trilogue agreement was reached on 11 December 2018. Parliament is expected to vote on the agreement during the March II 2019 plenary session. Third edition. The ‘EU Legislation in Progress’ briefings are updated at key stages throughout the legislative procedure. Please note this document has been designed for on-line viewing.

Risk-preparedness in the electricity sector

08-02-2019

On 30 November 2016, the European Commission adopted a proposal for a regulation on risk-preparedness in the electricity sector. This proposal addresses shortcomings in the existing legislation, notably a lack of regional coordination, and differing national rules and procedures. It would replace the existing legislation, and establish common rules on crisis prevention and crisis management in the electricity sector. Regional interdependencies would be taken into account in the preparation of national ...

On 30 November 2016, the European Commission adopted a proposal for a regulation on risk-preparedness in the electricity sector. This proposal addresses shortcomings in the existing legislation, notably a lack of regional coordination, and differing national rules and procedures. It would replace the existing legislation, and establish common rules on crisis prevention and crisis management in the electricity sector. Regional interdependencies would be taken into account in the preparation of national riskpreparedness plans and in managing crisis situations. The proposed regulation would enhance transparency by requiring an ex-post evaluation of crisis situations. In the European Parliament, the proposal was referred to the Committee on Industry, Research and Energy (ITRE), which adopted its report in February 2018. In November 2018, Council and Parliament reached an agreement in trilogue negotiations. The ITRE committee approved the text on 23 January 2019 and it needs now to be voted in plenary. Third edition. The ‘EU Legislation in Progress’ briefings are updated at key stages throughout the legislative procedure. Please note this document has been designed for on-line viewing.

Sector coupling: how can it be enhanced in the EU to foster grid stability and decarbonise?

19-11-2018

Sector coupling involves the increased integration of energy end-use and supply sectors with one another. This can improve the efficiency and flexibility of the energy system as well as its reliability and adequacy. Additionally, sector coupling can reduce the costs of decarbonisation. To foster the full potential of sector coupling in several end-use and supply applications, it is important that existing techno-economic, policy and regulatory barriers are removed. Furthermore, a more integrated ...

Sector coupling involves the increased integration of energy end-use and supply sectors with one another. This can improve the efficiency and flexibility of the energy system as well as its reliability and adequacy. Additionally, sector coupling can reduce the costs of decarbonisation. To foster the full potential of sector coupling in several end-use and supply applications, it is important that existing techno-economic, policy and regulatory barriers are removed. Furthermore, a more integrated approach to energy systems planning is needed. This document was provided by Policy Department A at the request of the Committee on Industry, Research and Energy.

Külső szerző

Luc VAN NUFFEL, João GORENSTEIN DEDECCA, Tycho SMIT, Koen RADEMAEKERS, Trinomics B.V.

The Potential of Electricity Demand Response

15-09-2017

This report summarises the presentations and discussions made during a workshop on ‘The Potential of Electricity Demand Response’ organised on 30 May 2017 by Policy Department A for the Committee on Industry, Research and Energy (ITRE). The aim of the workshop was to highlight the role and potential of electricity demand response in achieving the EU energy and climate policy targets, to illustrate the current experiences and progress towards deployment of demand response across the EU and to identify ...

This report summarises the presentations and discussions made during a workshop on ‘The Potential of Electricity Demand Response’ organised on 30 May 2017 by Policy Department A for the Committee on Industry, Research and Energy (ITRE). The aim of the workshop was to highlight the role and potential of electricity demand response in achieving the EU energy and climate policy targets, to illustrate the current experiences and progress towards deployment of demand response across the EU and to identify and evaluate possible legislative and regulatory initiatives to optimally deploy the potential. The presentations and proceedings of this workshop should support the ITRE members in their evaluation of the related legislative proposals in the “Clean Energy for All Europeans package”.

Külső szerző

Luc VAN NUFFEL, Jessica YEARWOOD

Capacity mechanisms for electricity

22-05-2017

Concerns about a lack of investment in electricity generation capacity to meet peak demand have prompted several EU Member States to introduce rewards for making capacity available, in the form of capacity mechanisms. Such mechanisms must conform to the EU guidelines on state aid for environmental protection and energy. However, capacity mechanisms are considered problematic because they risk distorting the internal electricity market. Moreover, purely national mechanisms are not as cost-effective ...

Concerns about a lack of investment in electricity generation capacity to meet peak demand have prompted several EU Member States to introduce rewards for making capacity available, in the form of capacity mechanisms. Such mechanisms must conform to the EU guidelines on state aid for environmental protection and energy. However, capacity mechanisms are considered problematic because they risk distorting the internal electricity market. Moreover, purely national mechanisms are not as cost-effective as mechanisms that allow for cross-border participation. To tackle these issues, the European Commission carried out a sector inquiry, in which it analysed capacity mechanisms in the EU and offered conclusions about the design principles needed to ensure their effectiveness and compatibility with the internal electricity market. It found that many Member States did not adequately assess the need or cost-effectiveness before introducing capacity mechanisms. Consequently, the Commission's 'clean energy for all Europeans' package, adopted in November 2016, includes a proposal for a recast of the Electricity Regulation, which updates the rules for European resource adequacy assessments and sets out design principles for national capacity mechanisms. In several resolutions, the European Parliament has expressed support for market-based cross-border capacity mechanisms, pointing out, however, that they should only be used under certain conditions. The Council of the EU stresses that ensuring the security of electricity supply is the responsibility of the Member States. Stakeholders have expressed various views about what the appropriate design of capacity mechanisms should be.

Overview of the internal energy market design legislation

23-01-2017

The new proposals build on previous legislation and continue to gradually implement an internal energy market. In particular, they look to incorporate recent changes, such as the rapid increase in renewables and technological advances relating to the digitalisation of services. They also attempt to clarify previous legislation such as in the case of storage for Transmission System Operators (TSOs) for example. As with the recent proposals on security of gas supply, the Commission looks to incorporate ...

The new proposals build on previous legislation and continue to gradually implement an internal energy market. In particular, they look to incorporate recent changes, such as the rapid increase in renewables and technological advances relating to the digitalisation of services. They also attempt to clarify previous legislation such as in the case of storage for Transmission System Operators (TSOs) for example. As with the recent proposals on security of gas supply, the Commission looks to incorporate a regional approach as the default option for assessing needs and mitigating risks. The Commission's evaluation, as well as the review of the implementation process, have shown that, while progress has been made, challenges to create a properly functioning internal market remain. The challenges identified by the evaluation, such as price controls, insufficient cross-border trade, uncoordinated national interventions and issues around regulatory independence, are addressed by the current proposals. However, it is also clear from the evaluation that progress towards a well-functioning and competitive energy market has not been consistent across the EU. Where progress has been made, the effects have been positive, although the evaluation does not look at examples of best practice to assess the best way forward. The EU- wide oversight of national regulators and TSOs is seen as positive, but question marks remain in terms of whether the suggested changes will be sufficient. Several reviews on the topic have noted that the Agency for the Cooperation of Energy Regulators (ACER) lack sufficient powers to be effective and it is unclear whether the current proposals will properly address this issue. The public consultations also pointed to the dual role of the European Network for Transmission System Operators for electricity (ENTSO-E), as both a lobby organisation and a representative of public interest,  as potentially problematic. The creation of a European Distribution System Operator (DSO) could possibly duplicate this issue. The evaluation does not include any assessment around infrastructure legislation or the EU's role in this area; however, it notes that the incentives for private investments have been insufficient so far. It is hoped that the proposed moves to a more flexible and price-driven market should improve investment conditions. As reforms in this area have been ongoing since the 1990s, it will be particularly important to continue to monitor progress and to what extent the new proposals increase competition and a well-functioning, price-led market. In terms of the Parliament's demands, many of its requests are reflected in the proposals, such as calls for more regional cooperation, for example. They do not, however, include a review of the gas market or interconnectivity objectives differentiated by regions; nor do they look to address to any great extent the issue of external import. In the case of the ACER, Parliament had asked for a substantial increase in resources. While the proposals strengthen the agency's position, the Commission decided not to propose making the ACER into a pan-European regulator, with the increase in budget and staff that such a move would have entailed.

European Energy Industry Investments

16-01-2017

This study was prepared at the request of the European Parliament's Committee on Industry, Research and Energy (ITRE). The paper provides an overall assessment of European investments in the electricity sector. It concludes by providing policy recommendations to facilitate the investments in the electricity sector which are needed to enable a transition to a low carbon energy supply, while realising a fully integrated and interconnected electricity system, enhancing competitiveness and ensuring security ...

This study was prepared at the request of the European Parliament's Committee on Industry, Research and Energy (ITRE). The paper provides an overall assessment of European investments in the electricity sector. It concludes by providing policy recommendations to facilitate the investments in the electricity sector which are needed to enable a transition to a low carbon energy supply, while realising a fully integrated and interconnected electricity system, enhancing competitiveness and ensuring security of electricity supply.

Külső szerző

Luc VAN NUFFEL, Koen RADEMAEKERS, Jessica YEARWOOD and Verena GRAICHEN

What if electric cars became an affordable and convenient way to travel?

07-12-2016

Are electric cars on the verge of becoming the norm, should we encourage this transition, and what would be the consequences for the environment, the automobile industry and our electricity grid? Over the past century, cars have become an integral part of our society. They generally offer greater flexibility than alternative modes of transport, and they are affordable to a large proportion of people. Ever since cars were first mass-produced, they have almost exclusively been powered by ICEs (internal ...

Are electric cars on the verge of becoming the norm, should we encourage this transition, and what would be the consequences for the environment, the automobile industry and our electricity grid? Over the past century, cars have become an integral part of our society. They generally offer greater flexibility than alternative modes of transport, and they are affordable to a large proportion of people. Ever since cars were first mass-produced, they have almost exclusively been powered by ICEs (internal combustion engines), which burn fossil fuels, such as petrol and diesel, to provide the energy required to turn the cars’ wheels and perform auxiliary tasks. However, in recent years concerns about climate change and dependence on oil have led to a great deal of effort and attention being invested in developing alternative ways of providing this energy.

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