The EC Adopts New Reform on Power Market

The European Commission (EC) has adopted a new reform on the EU electricity market, aiming to promote PPAs, contracts for difference (CfDs) mechanism, market stability and consumer protection, according to the EU, cited by Poland’s ISB news.

• The updated rules promote the use of long-term PPAs to provide stability for customers and investors and support renewable energy investments.
• Member States will use bilateral CfDs or equivalent schemes to support new electricity generation investments and stabilize electricity prices, reducing volatility from fossil fuel markets.
• Under bilateral CfDs, energy producers are guaranteed a minimum price and must repay excess revenues during high-price periods, benefiting final customers and reducing electricity costs.
• In a declared electricity crisis, Member States must reduce prices for vulnerable customers and prevent market distortions, ensuring a level playing field for suppliers.
• The reform also encourages energy-sharing systems alongside existing provisions for renewable and citizen energy communities.
• And capacity mechanisms will become structural elements of the electricity market, enhancing supply security and flexibility as renewable energy share increases.
• The regulation will enter into force 20 days after publication, and Member States will have six months to adapt their national laws to the new electricity market.