EU proposes revision of internal electricity market design
Process in Brief
The Commission’s proposal would revise several EU laws, notably the Electricity Regulation, the Electricity Directive and the REMIT Regulation, and introduces measures to incentivise longer‑term contracts, boost power purchase agreements and require two‑way contracts for difference where public support is needed. It also seeks to improve forward and short‑term market functioning, accelerate multi‑country offshore renewables and strengthen ACER and national regulators’ monitoring powers.
What Is at Stake
The reform aims to shield consumers from volatile fossil‑fuel prices by expanding rights to fixed‑price contracts, enabling energy sharing and requiring protections such as suppliers of last resort and safeguards against disconnection for vulnerable households. It also intends to lower investment risk for renewables through longer‑term contracts, guarantee schemes for PPA access and two‑way CfDs that limit windfall revenues and channel excess receipts to reduce consumer bills.
Timeline
The proposal now enters the ordinary legislative procedure for discussion and agreement by the European Parliament and the Council.
Sources
Official Documents
- Questions and Answers on the revision of the EU's internal electricity market design The European Commission proposes reform of the EU electricity market design, including long-term contracts, two-way contracts for difference, and energy sharing to stabilise prices, boost renewables, and empower consumers.
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