The energy price crisis has driven high-level political discussions on the EU electricity market design. Today, the European Commission has published its proposal to reform the EU’s electricity market design.
Naomi Chevillard, Head of Regulatory Affairs at SolarPower Europe:
- On Contracts for Difference (CfDs) & Power Purchasing Agreements (PPAs)
“We’re glad to see that today’s proposal builds on the well-established foundation of the European electricity markets, without upheaving fundamental market principles.
Critically, the text protects all the ways we can deploy and enjoy solar energy.
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.
It's a relief to see that only new solar projects which benefit from state support will be put under government-organised two-sided CfDs. We’re particularly grateful to have avoided CfD as the only route to market for new solar, or retroactive CfDs on existing solar projects. Investors can trust that the terms of their investments won’t suddenly change.
Going forward, we’ll be working to make sure the CfD and PPA markets function well in parallel, and that there’s enough room for EU countries to implement innovative ways to remunerate solar projects.”
- On new ways to share energy
“It’s a historic moment for energy sharing. New proposals literally put the power in citizens’ hands. For the first time ever, we’ll have a legal framework to share electricity, complementing the energy communities’ framework.
This will only improve access to solar. People can share low cost solar energy with their neighbours, and directly benefit from reduction on their energy bills, while supporting the grid integration of solar. Companies will have a new framework to finance and operate energy sharing schemes. As energy sharing goes mainstream, we’ll need to make sure it aligns with efficient grid use."
- On support for grid flexibility
“Importantly, today’s proposal considers the role of electricity grids in facilitating access to green, low-cost, energy. Developers planning new solar projects will have more information on where, when, and how they can connect their solar to the grid.
After specific calls from SolarPower Europe, we now can see support for large-scale and residential grid flexibility resources – like solar batteries and demand side response. The plan will empower energy storage to alleviate pressure on the grid, deliver 24/7 solar, and help energy storage owners see a return on their investments.”
The proposed reform will now have to be discussed and agreed by the European Parliament and the Council before entering into force.
SolarPower Europe Position Paper on Electricity Market Design
Decarbonising the energy system. Empowering citizens and businesses with renewables. Strengthening grids, stabilising markets, and getting flexibility involved.Read now