EC proposes electricity market reform to boost renewables

Facebook
Twitter
LinkedIn
Reddit
Email
Among the measures to be reformed is better access to solar PV power purchase agreements. Image: Glyn Lowe via Flickr.

The European Commission has proposed to reform the EU’s electricity market design in a move to accelerate the uptake of renewables.

The reform which is part of the EC’s Green Deal Industrial Plan aims to enhance the competitiveness of Europe’s net-zero industry and offer better stability of price electricity, which has been one of the main concerns coming from European solar manufacturers in order to be able to play at a level-playing field with other countries.

This article requires Premium SubscriptionBasic (FREE) Subscription

Unlock unlimited access for 12 whole months of distinctive global analysis

Photovoltaics International is now included.

  • Regular insight and analysis of the industry’s biggest developments
  • In-depth interviews with the industry’s leading figures
  • Unlimited digital access to the PV Tech Power journal catalogue
  • Unlimited digital access to the Photovoltaics International journal catalogue
  • Access to more than 1,000 technical papers
  • Discounts on Solar Media’s portfolio of events, in-person and virtual

Or continue reading this article for free

Several legislations will be reformed, including the Electricity Regulation, the Electricity Directive and the Regulation on Wholesale Energy Market Integrity and Transparency (REMIT) Regulation while introducing measures to incentivise longer-term contracts with non-fossil power production.

The EC will aim to reflect the lower cost of renewables, which could boost even further the installation rate of solar PV as the EU aims to deploy 740GWdc of solar PV by the end of the decade, as part of its REPowerEU strategy released last year.

Kadri Simson, EU commissioner for Energy, said: “We are today proposing measures that will enhance the stability and predictability of energy costs across the EU. Driving investment in renewables will help us reach our Green Deal goals and make the EU the powerhouse of clean energy for the coming decades.”

As the proposal includes measures to accelerate the deployment of renewables and the phase-out of gas it will further integrate the integration of renewables in the electricity system while improving conditions for the use of flexibility solutions, such as storage or hydropower.

In addition, system operators will be required to offer better transparency in terms of grid connection capacity availability, while trading deadlines would be brought closer to real-time to allocate a better flow of renewables trade and balancing.

Among these reforms, the EC will propose to ease the deployment of more stable long-term power purchase agreements (PPAs), with member states asked to ensure the availability of market-based guarantees for PPAs.

In order to provide power producers with more stability and avoid price volatility, any public support for new investments in renewables will be done via a two-way contracts for difference (CfDs).

Naomi Chevillard, head of regulatory affairs at SolarPower Europe, said: “Homes and businesses will be able to access PPAs more easily. Businesses are set to benefit from new government de-risking schemes that backup their ability to sign these long-term energy supply contracts. The reinforced legislative framework for PPAs will give both suppliers and buyers more clarity in signing new agreements.”

Moreover, one of the reforms concerns the possibility for consumers to invest in solar parks and sell excess rooftop solar electricity to neighbours, not only to the supplier bringing another potential income source.

Rooftop solar was also in the discussion in Strasbourg on Tuesday as the European Parliament voted and approved the Energy Performance of Buildings Directive (EPBD) which will give better support for rooftop solar across Europe and accelerate its deployment starting from 2025.

Jan Osenberg, policy advisor at SolarPower Europe, said: “The European Parliament’s support for the European Solar Rooftops Initiative, sends one clear signal: solar buildings are a key solution to lowering energy bills, ensuring energy security, and meeting our climate ambitions.”

The proposed reforms for the European electricity market will now be discussed and agreed upon by the European Parliament and the Council before being enforced.

4 June 2024
London, UK
UK Solar Summit 2024 will look at the role solar currently plays in the energy mix, how this will change over the coming years and how this aligns with net-zero and other government targets. We will break down all these challenges and help build up solutions through discursive panels, motivational keynotes and case studies, with newly added interactive sessions to get you moving and meeting your peers, making the connections you need to boost your business.
11 March 2025
Frankfurt, Germany
The conference will gather the key stakeholders from PV manufacturing, equipment/materials, policy-making and strategy, capital equipment investment and all interested downstream channels and third-party entities. The goal is simple: to map out PV manufacturing out to 2030 and beyond.

Read Next

Subscribe to Newsletter

Upcoming Events

Solar Media Events
May 21, 2024
Sydney, Australia
Solar Media Events
May 21, 2024
Napa, USA
Solar Media Events
May 22, 2024
London, UK
Upcoming Webinars
May 29, 2024
11am (EDT) / 5pm (CEST)