ACER and CEER welcome the market-based solutions and cross-border focus of the European Commission’s energy market design

ACER and CEER welcome the new energy market design consultation paper, launched today by the European Commission, and in particular the reinforced steer towards cross-border and market-based solutions.

Lord Mogg, Chair of the ACER Board of Regulators and President of CEER said: “we are consistent advocates of competitive energy markets and we strongly support the Commission’s proposals. Integrating renewables into the market requires flexibility to be rewarded and demand-side response with far greater consumer response to be developed. The robust focus on market-based solutions supported by the right regulatory framework will allow well-functioning retail markets to grow”.

Alberto Pototschnig, ACER Director, said: “The Commission’s energy market design consultation paper and regulators’ own developed thinking in our Bridge to 2025 proposals are well aligned. We have always supported consistent EU-level rules. We share the common aim of establishing liquid, competitive and integrated energy markets that work for consumers”.   Providing their initial reactions to the consultation launch, regulators underline:   - How important it is to enhance the functioning of electricity markets by bringing renewables (RES) into the market and linking wholesale and retail markets.   - We must move away from national interventions. We welcome the Commission’s ambition for a more harmonised EU approach to capacity markets and RES support schemes. To the benefit of European security of supply, ACER and CEER have long advocated an EU approach for measures on generation adequacy, network planning and capacity remuneration mechanisms.   - There must be greater participation in energy markets by facilitating a proportionate market-based approach to flexibility (an issue that CEER and ACER are jointly working on), including demand response, self-consumption, and emerging market innovation. The pivotal role of distribution networks in future interactive and flexible markets must be addressed.   - The importance of embedding robust and transparent governance to support an effective market, with clear roles and responsibilities for all energy actors.   - A fit-for-purpose market design must be developed to put consumers at the centre and which allows the regulatory framework and market rules to adapt to future developments.   Regulators will provide their complete response before the end of the Commission’s consultation. Moreover, in line with the commitments made (in September 2014) in our “Bridge to 2025” proposals, regulators are proactively working to deliver the cross-border trading rules necessary for a truly European wholesale market, and to develop a regulatory framework that supports a future-proof market design at both wholesale and retail levels (e.g. the newly published CEER paper on the future role of Distribution System Operators, a forthcoming paper on well-functioning retail energy markets and planned work on tariffs and incentives).