This European Commission prepares a reform in the electricity market end the volatility experienced during the energy crisis and promote the transition to decarbonisation of the sector. All parties involved, from governments to energy companies, are taking positions to apply pressure before Brussels makes its proposal public in mid-March.
The Spanish government was ahead of everyone and was the first to send a full proposal to the European Commission on where this major market reform should go. It’s a model designed by the Ministry of Ecological Transition, under the command of Vice President Teresa Ribera, to fragment the existing market with technology and impose long-term contracts and fixed prices for nuclear, hydropower and renewable energy.
A dozen energy employers led by major electricity companies Aelec, They signed a joint document in which they rejected the main measures envisaged in the government plan, without explicitly mentioning the proposal of the Spanish government. An English-language document circulating in Brussels and made public this Thursday is simply 24 hours after the work summit attended by the Ministry of Ecological Transition urged the same employers to consider electricity market reform.
The Spanish Executive proposed keeping the electricity produced by gas and coal plants in the current daily and intraday market; this will claim compensation (capacity payments) as it is available in the highest demand. Renewable, nuclear and hydraulic would have a fixed price for years through contracts with the electrical system. The price that renewable energy will charge will be determined by a system similar to existing government tenders, while nuclear and hydro will be a price set by the regulator.
In the document signed by the energy employers The possibility of the future electricity market being based on “viable” long-term contracts is often criticized. He argued that governments should sign “freely”, and in any case both electricity producers and companies that consume it.
“An electricity market model based on the central purchase of most of the marginal energy (renewable, nuclear and hydraulic) in energy contracts at a fixed price, which can be imposed unilaterally by Member States, can affect the market and energy activities. fragmenting the internal market and discouraging the development of flexibility in the system”, stated in the text. And energy companies are alleged to “guarantee that all agents can choose freely and without limitations or obligations between investing under CFD support programs”, contrary to the recommendation of Vice President Ribera. [contrato por diferencias, a precio fijo] or sell to market.
Initially, the document includes the logos of the employers’ association of the electricity companies Aelec (bringing together Iberdrola, Endesa and EDP), various renewable energy organizations such as Appa, AEE or UNEF; that of independent producers Aprie; that of Armie market representatives; Aedive electric vehicle association; Afbel of electrical equipment manufacturers; that of Aepibal battery companies; energy agencies and services Entra; as well as the Portuguese electricity employer Elecpor.
After revealing the contents of the document, photovoltaics association UNEF decided to withdraw, and several employers (Aedive, AEE, Aepibal, Afbel, APPA Renovables and Aprie) stressed in a subsequent public memo that the text was “by no means clearly focused”. It seeks to criticize any national proposal prepared by a Member State” and only to “constructively provide for the technical and economic criteria that should ensure the smooth functioning of the markets in the future”.