Power Markets in Transition: why do we need a new Market Design?

Renaissance Hotel

The adoption of the 20-20-20 energy policy framework and the decarbonisation vision for Europe by 2050 have led to a fundamental transition process with far-reaching impacts on European power markets. How can we set the EU on a path towards a greener economy that is in line with the industry's capabilities? As the power market moves towards an ever growing share of renewables, is a new market design needed?

Following on from the successful EURELECTRIC event on 12 December 2013, this conference addressed the main outstanding issues related to the implementation/expansion of capacity remuneration mechanisms across Europe. What are the main design options available to policymakers to remunerate energy and capacity products in a market based way?

Focus was placed inter alia on:

  • discussions held at regional level to coordinate generation adequacy assessment and capacity remuneration towards a possible single model (PLEF, France-Germany energy dialogue), including a EURELECTRIC assessment of market design alternatives;
  • attempts made by countries implementing capacity remuneration mechanisms to accommodate cross-border participation.

The conference provided an opportunity for policymakers, the electricity industry, TSOs and other stakeholders to exchange views on the necessary adaptations to the current market design and how these should be implemented so that they are fully compatible with the goal of achieving an Internal Electricity Market.