1
EU Energy Law
(2024)
Martin SVEC
Masaryk University
2
EU TEU TFEU
EU
EU Institutions
EU Member States
3
EU TEU TFEU
EU
EU Institutions
EU Member States
EU Member States
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Energy:	Relevant	Competences
5
Common	
Commercial	
Policy
CCP
exclusive and external competence.
The CCP covers trade tariffs and trade agreements
relating to trade in goods and services, commercial
aspects of intellectual property and foreign direct
investments.
EU external action can considerably contribute to the
removal of trade barriers.
Trade in energy-related materials and products.
Examples: Conclusion of the Energy Charter Treaty, the
Energy Community.
6
Common	
Commercial	
Policy
Article 207 TFEU:
1. The common commercial policy shall be based on uniform
principles, particularly with regard to changes in tariff rates, the
conclusion of tariff and trade agreements relating to trade in
goods and services, and the commercial aspects of intellectual
property, foreign direct investment, the achievement of
uniformity in measures of liberalisation, export policy and
measures to protect trade such as those to be taken in the event
of dumping or subsidies. The common commercial policy shall be
conducted in the context of the principles and objectives of the
Union's external action.
7
Environment
Articles: 191-193 TFEU
Shared competence.
Article 191 includes objective “the promotion of measures at international level to deal with
regional or worldwide environmental problems, and in particular combating climate change”.
Key principles:
A high level of protection.
The precautionary principle: The precautionary principle enables decision-makers to adopt precautionary measures when
scientific evidence about an environmental or human health hazard is uncertain and the stakes are high.
The prevention principle: This principle allows action to be taken to protect the environment at an early stage. It is now not only a
question of repairing damages after they have occurred, but to prevent those damages occurring at all. This principle is not as farreaching
as the precautionary principle. It means in short terms: it is better to prevent than repair.
The principle that environmental damage should as a priority be rectified at source: The rectification at source principle
means that environmental damage should, as a priority, be addressed by targeting its original cause and taking preventive action
at the origin of the problem. This principle places the responsibility for managing environmental damage on the polluter or the
source of environmental harm. It reinforces the responsibility for managing environmental damage at the source of that damage therefore
linking it to the polluter. The principle also encourages processes that are inherently clean rather than approaches which
treat the problem as or after it occurs.
The 'polluter pays' principle: The commonly accepted practice that those who produce pollution should bear the costs of
managing it to prevent damage to human health or the environment. For instance, a factory that produces a potentially poisonous
substance as a by-product of its activities is usually held responsible for its safe disposal.
8
Environment
Article 191 TFEU
1. Union policy on the environment shall contribute to pursuit of the following objectives:
• preserving, protecting and improving the quality of the environment,
• protecting human health,
• prudent and rational utilisation of natural resources,
• promoting measures at international level to deal with regional or worldwide environmental problems, and in particular combating climate
change.
2. Union policy on the environment shall aim at a high level of protection taking into account the diversity of situations in the various regions of
the Union. It shall be based on the precautionary principle and on the principles that preventive action should be taken, that environmental
damage should as a priority be rectified at source and that the polluter should pay.
3. In preparing its policy on the environment, the Union shall take account of:
- available scientific and technical data,
- environmental conditions in the various regions of the Union,
- the potential benefits and costs of action or lack of action,
- the economic and social development of the Union as a whole and the balanced development of its regions.
4. Within their respective spheres of competence, the Union and the Member States shall cooperate with third countries and with the competent
international organisations. The arrangements for Union cooperation may be the subject of agreements between the Union and the third parties
concerned.
Article 192 TFEU
1. The European Parliament and the Council, acting in accordance with the ordinary legislative procedure and after consulting the Economic and Social
Committee and the Committee of the Regions, shall decide what action is to be taken by the Union in order to achieve the objectives referred to in
Article 191.
2. By way of derogation from the decision-making procedure provided for in paragraph 1 and without prejudice to Article 114, the Council acting
unanimously in accordance with a special legislative procedure and after consulting the European Parliament, the Economic and Social Committee
and the Committee of the Regions, shall adopt: (a) provisions primarily of a fiscal nature; (b) measures affecting: - town and country planning, quantitative
management of water resources or affecting, directly or indirectly, the availability of those resources, - land use, with the exception of
waste management; (c) measures significantly affecting a Member State's choice between different energy sources and the general
structure of its energy supply. The Council, acting unanimously on a proposal from the Commission and after consulting the European
Parliament, the Economic and Social Committee and the Committee of the Regions, may make the ordinary legislative procedure applicable to the
matters referred to in the first subparagraph.
3. General action programmes setting out priority objectives to be attained shall be adopted by the European Parliament and the Council, acting in
accordance with the ordinary legislative procedure and after consulting the Economic and Social Committee and the Committee of the Regions. The
measures necessary for the implementation of these programmes shall be adopted under the terms of paragraph 1 or 2, as the case may be.
4. Without prejudice to certain measures adopted by the Union, the Member States shall finance and implement the environment policy.
5. Without prejudice to the principle that the polluter should pay, if a measure based on the provisions of paragraph 1 involves costs deemed
disproportionate for the public authorities of a Member State, such measure shall lay down appropriate provisions in the form of: - temporary
derogations, and/or - financial support from the Cohesion Fund set up pursuant to Article 177.
9
Energy
Article 194 TFEU
Shared competence.
1. In the context of the establishment and functioning of the internal market and with regard for the need to
preserve and improve the environment, Union policy on energy shall aim, in a spirit of
solidarity between Member States, to:
(a) ensure the functioning of the energy market;
(b) ensure security of energy supply in the Union;
(c) promote energy efficiency and energy saving and the development of new and renewable forms of
energy; and
(d) promote the interconnection of energy networks.
2. Without prejudice to the application of other provisions of the Treaties, the European Parliament and the
Council, acting in accordance with the ordinary legislative procedure, shall establish the measures necessary
to achieve the objectives in paragraph 1. Such measures shall be adopted after consultation of the Economic
and Social Committee and the Committee of the Regions.
Such measures shall not affect a Member State's right to determine the conditions for exploiting its
energy resources, its choice between different energy sources and the general structure of its energy
supply, without prejudice to Article 192(2)(c).
10
Energy	
solidarity
OPAL - T883/16
(78) Having regard to the scope of the principle of solidarity, the Commission was required, in the
context of the contested decision, to assess whether the variation to the regime governing the operation
of the OPAL pipeline, as proposed by the German regulatory authority, could affect the interests in the
field of energy of other Member States and, if so, to balance those interests with the interests that that
variation had for the Federal Republic of Germany and, if relevant, the European Union.
11
Energy
Limitation of Article 194(2) TFEU: Treaty shall not
affect Member State’s sovereignty over the choice of
its energy sources and the general structure of its
energy supply in the electricity sector.
12
Art.	194	
or	192?
Article 194 TFEU
Shared competence.
1. In the context of the establishment and functioning of the internal market and
with regard for the need to preserve and improve the environment, Union policy
on energy shall aim, in a spirit of solidarity between Member States, to:
(a) ensure the functioning of the energy market;
(b) ensure security of energy supply in the Union;
(c) promote energy efficiency and energy saving and the development of new
and renewable forms of energy; and
(d) promote the interconnection of energy networks.
2. Without prejudice to the application of other provisions of the Treaties, the
European Parliament and the Council, acting in accordance with the ordinary
legislative procedure, shall establish the measures necessary to achieve the
objectives in paragraph 1. Such measures shall be adopted after consultation of
the Economic and Social Committee and the Committee of the Regions.
Such measures shall not affect a Member State's right to determine the
conditions for exploiting its energy resources, its choice between different
energy sources and the general structure of its energy supply, without
prejudice to Article 192(2)(c).
Article 192 TFEU
1. The European Parliament and the Council, acting in accordance with the ordinary legislative
procedure and after consulting the Economic and Social Committee and the Committee of the
Regions, shall decide what action is to be taken by the Union in order to achieve the objectives
referred to in Article 191.
2. By way of derogation from the decision-making procedure provided for in paragraph 1 and
without prejudice to Article 114, the Council acting unanimously in accordance with a special
legislative procedure and after consulting the European Parliament, the Economic and Social
Committee and the Committee of the Regions, shall adopt: (a) provisions primarily of a fiscal
nature; (b) measures affecting: - town and country planning, - quantitative management of
water resources or affecting, directly or indirectly, the availability of those resources, - land
use, with the exception of waste management; (c) measures significantly affecting a
Member State's choice between different energy sources and the general structure of
its energy supply. The Council, acting unanimously on a proposal from the Commission and
after consulting the European Parliament, the Economic and Social Committee and the
Committee of the Regions, may make the ordinary legislative procedure applicable to the
matters referred to in the first subparagraph.
3. General action programmes setting out priority objectives to be attained shall be adopted by
the European Parliament and the Council, acting in accordance with the ordinary legislative
procedure and after consulting the Economic and Social Committee and the Committee of the
Regions. The measures necessary for the implementation of these programmes shall be
adopted under the terms of paragraph 1 or 2, as the case may be.
4. Without prejudice to certain measures adopted by the Union, the Member States shall finance
and implement the environment policy.
5. Without prejudice to the principle that the polluter should pay, if a measure based on the
provisions of paragraph 1 involves costs deemed disproportionate for the public authorities of
a Member State, such measure shall lay down appropriate provisions in the form of: temporary
derogations, and/or - financial support from the Cohesion Fund set up pursuant to
Article 177.
13
Art.	194	or	192?
EU ETS T-370/11
However, it is true that, under the second subparagraph of Article 194(2) TFEU, measures established in accordance with the
procedure laid down in the first subparagraph of that paragraph and necessary to achieve the policy objectives of the European
Union in the area of energy, referred to in paragraph 1 of that article, cannot affect the right of a Member State to determine the
conditions for exploiting its energy resources, its choice between different energy sources and the general structure of its energy
supply.
However, there is no reason to suppose that the second subparagraph of Article 194(2) TFEU establishes a general prohibition to
assign that right that is applicable in European Union policy in the area of the environment (see, to that effect, Case C-490/10
Parliament v Council [2012] ECR, paragraph 77). On the one hand, Article 194 TFEU is a general provision which relates solely
to the energy sector and, consequently, delineates a sectoral competence (Opinion of Advocate General Mengozzi in Parliament v
Council, point 33). On the other hand, it should be noted that the second subparagraph of Article 194(2) TFEU expressly refers to
point (c) of the first subparagraph of Article 192(2) TFEU. Indeed, the second subparagraph Article 194(2) TFEU provides that
the prohibition on affecting the right of a Member State to determine the conditions for exploiting its energy resources, its choice
between different energy sources and the general structure of its energy supply applies without prejudice to point (c) of the first
subparagraph of Article 192(2) TFEU. While it is true that that latter provision is only procedural in nature, it none the less
provides specific rules relating to the environment policy of the European Union. It follows that the right referred to in the
second subparagraph of Article 194(2) TFEU is not applicable in the present case, since the contested decision constitutes an
action taken by the European Union within the framework of its environment policy.
14
Art.	194	or	192?
EU ETS C-5/16
EU ETS - Establishment and application of the market stability reserve
The Republic of Poland claims that the contested decision infringes Article 192(1) TFEU, read in conjunction with point (c) of the
first subparagraph of Article 192(2) TFEU, in that it was adopted in accordance with the ordinary legislative procedure
although it constitutes a measure significantly affecting a Member State’s choice between different energy sources and the
general structure of its energy supply within the meaning of the latter provision. Under the first subparagraph of Article 192(2)
TFEU, such a decision should have been adopted by the Council unanimously, in accordance with the special legislative
procedure.
Court:
It follows that point (c) of the first subparagraph of Article 192(2) TFEU can form the legal basis of an EU measure only if it
follows from the aim and content of that measure that the primary outcome sought by that measure is significantly to affect a
Member State’s choice between different energy sources and the general structure of the energy supply of that Member State.
15
Internal	Energy	Market
16
Liberalisation	
of	EU	Energy	
Markets
“Liberalization becomes reality if users are free in law and in
fact to select their suppliers.”
1) Principle of free competition in the generation of electricity.
2) A prerequisite for the freedom of choice is that each supplier
can get access to the networks linking supply and demand (need
for non-discriminatory access to networks).
via. Third party access
3) Non-discriminatory environment
via. Unbundling of energy suppliers from network
operators
4) Independent national authorities and their cooperation
via. ACER
5) Electricity and gas can physically cross-national borders
via. energy infrastructure
6) Removal of regulatory and technical barriers
via. ENTSO-E/ENTSO-G and network codes
17
Principleoffree
competitionin
thegeneration
ofelectricity
Article 7 of the DIRECTIVE 2009/72/EC
Authorisation procedure for new capacity
1. For the construction of new generating capacity, Member States shall
adopt an authorisation procedure, which shall be conducted in
accordance with objective, transparent and non-discriminatory criteria.
2. Member States shall lay down the criteria for the grant of
authorisations for the construction of generating capacity in their
territory. In determining appropriate criteria, Member States shall consider:
(a) the safety and security of the electricity system, installations and
associated equipment; (b) the protection of public health and safety; (c) the
protection of the environment; (d) land use and siting; (e) the use of public
ground; (f) energy efficiency; (g) the nature of the primary sources; (h) the
characteristics particular to the applicant, such as technical, economic and
financial capabilities; (i) compliance with measures adopted pursuant to
Article 3; (j) the contribution of the generating capacity to meeting the
overall Community target of at least a 20 % share of energy from
renewable sources in the Community’s gross final consumption of energy
in 2020 referred to in Article 3(1) of Directive 2009/28/EC of the European
Parliament and of the Council of 23 April 2009 on the promotion of the use
of energy from renewable sources (17); and (k) the contribution of
generating capacity to reducing emissions.
18
Third Party
Access
Article 32 of the DIRECTIVE 2009/72/EC
Article 32 of the DIRECTIVE 2009/73/EC
1. (…) Member States shall ensure the implementation of a
system of third-party access to the transmission and
distribution systems based on published tariffs, applicable to
all eligible customers and applied objectively and without
discrimination between system users.
19
Unbundling
electricity
Article 9 of the DIRECTIVE 2009/72/EC
Article 26 of the DIRECTIVE 2009/72/EC
gas
Article 9 of the DIRECTIVE 2009/73/EC
Article 32 of the DIRECTIVE 2009/73/EC
The rules on unbundling aim at preventing companies which are
involved both in transmission of energy and in production
and/or supply of energy from using their privileged position as
operators of a transmission network to prevent or obstruct access
of their competitors to this network. Unbundling requires
effective separation of activities of energy
transmission from production and supply interests.
20
Independent
nationalregulatory
authorities
Principle of independence
Member States shall guarantee the independence of the regulatory authority and shall ensure that it
exercises its powers impartially and transparently. For this purpose, Member State shall ensure that,
when carrying out the regulatory tasks, the regulatory authority:
(a) is legally distinct and functionally independent from any other public or private entity;
(b) ensures that its staff and the persons responsible for its management: (i) act independently
from any market interest; and (ii) do not seek or take direct instructions from any
government or other public or private entity when carrying out the regulatory tasks.
In order to protect the independence of the regulatory authority, Member States shall in
particular ensure that: (a) the regulatory authority can take autonomous decisions,
independently from any political body, and has separate annual budget allocations, with
autonomy in the implementation of the allocated budget, and adequate human and financial
resources to carry out its duties; and (b) the members of the board of the regulatory authority or, in
the absence of a board, the regulatory authority’s top management are appointed for a fixed term of
five up to seven years, renewable once.
DIRECTIVE 2009/72/EC
Article 35 Designation and independence of regulatory authorities
DIRECTIVE 2009/73/EC
Article 35 Designation and independence of regulatory authorities
21
ACER
Regulation (EC) No 713/2009 of the European Parliament and of
the Council of 13 July 2009 establishing an Agency for the
Cooperation of Energy Regulators
As an independent European structure which fosters cooperation
among European energy regulators, ACER ensures that market
integration and the harmonisation of regulatory frameworks are
achieved within the framework of the EU’s energy policy
objectives.
Objective:
• A more competitive, integrated market which offers consumers
more choice;
• An efficient energy infrastructure guaranteeing the free movement
of energy across borders and the transportation of new energy
sources, thus enhancing security of supply for EU businesses and
consumers;
• A monitored and transparent energy market guaranteeing
consumers fair, cost-reflective prices and the deterrence of
abusive practices.
22
Cross-border	
exchanges	in	
electricity	or	gas
(Network	codes)
Regulation (EC) No 714/2009 of the European Parliament and of the Council
on conditions for access to the network for cross-border exchanges in electricity
Regulation (EC) No 715/2009 of the European Parliament and of the Council
on conditions for access to the natural gas transmission networks
Conditions for network access for cross-border electricity/gas exchanges:
a) Tariffication
b) Congestion management
c) Network security
European network of transmission system operators for electricity (ENTSO-E)
European network of transmission system operators for gas (ENTSO-G)
A network code (NC) is a set of technical rules enabling the development of
the internal energy market in Europe. The NCs address the major barriers impeding the cross-border
flow of electricity and gas, transforming a mere patchwork of national energy markets into a
single European energy market.
NC are designed by ENTSO-E/G, ACER, the European Commission
23
2015	Energy	Union
24
Energy	Union
2015 Energy Union is …
a policy initiative
a complex strategy
bringing together energy and climate actions as well as actions in other
relevant policy areas, leading to more and longer-term policy coherence.
The objective: to give EU citizens and businesses …
…	secure, sustainable, competitive and affordable energy (energy
dimension)
and
… to make economy sustainable, low-carbon and climate-friendly
(climate dimension).
25
Energy	Union
Paradoxically,	 energy	 policy	 has	 been	 one	 of	 the	 slower	 areas	 to	 develop	 in	 the	
European	 Union,	 despite	 the	 Union’s	 roots,	 which	 lie,	 in	 part,	 in	 two	 energy-related	
international	organizations:	the	European	Coal	and	Steel	Community	and	Euratom.	
The	European	Coal	and	Steel	Community	(founded	in	1951)
• Germany,	France,	Italy,	Belgium,	the	Netherlands,	Luxembourg
• A	new	type	of	pollical	cooperation.
• Coal	and	steel	production	was	placed	under	common,	supranational	control	(both	coal	
and	steel	was	needed	to	build	the	machinery	of	war	as	well	as	in	times	of	peace).
The	European	Economic	Community	(founded	in	1957)
• Economic	integration.
• It	was	clear	from	early	on	that	the	EEC	would	apply	to	the	energy	sector.
• However,	no	concrete	steps	have	been	taken	to	integrate	energy	markets.
• Energy	markets	remained	largely	isolated	from	one	another.
The	Euratom	(founded	in	1957)
• Aimed	to	promote	nuclear	power.
26
Energy	Union
COM(2015) 80 final A Framework Strategy for a Resilient
Energy Union with a Forward-Looking Climate Change Policy
Energy Union with a Forward-Looking Climate Change Policy. The Energy
Union, which aimed to deliver greater energy security, sustainability and
competitiveness, was to be made up of “five mutually-reinforcing and
closely interrelated dimensions”:
A) Energy security, solidarity and trust
B) A fully integrated European energy market
C) Energy efficiency contributing to moderation of demand
D) Decarbonising the economy
E) Research, Innovation and Competitiveness
27
A fully
integrated
European
energy market
Clean Energy for All Europeans Package
1. The recast Renewable Energy Directive (EU) 2018/2001
2. Governance of the Energy Union and Climate Action (EU)
Regulation 2018/1999
3. Regulation on risk-preparedness in the electricity sector
(EU) 2019/941
4. Regulation establishing a European Union Agency for the
Cooperation of Energy Regulators (EU) 2019/942
5. Regulation on the internal market for electricity (EU)
2019/943
6. Directive on common rules for the internal market for
electricity (EU) 2019/944
28
A fully
integrated
European
energy market
Clean Energy for All Europeans Package
CEP aimed to modernize European electricity markets with a particular
focus on decarbonisation and enabling the participation of active
consumers.
Traditional objective: the establishment of common internal energy
market, ensuring energy security, energy efficiency, competitiveness
CEP: further deployment of renewables is required + transformation of
the grid + active participation of the end-consumer.
DRIVERS: TECHNOLOGICAL DEVELOPMENT AND DIGITALIZATION
29
Electricity
Directive
recast
DIRECTIVE (EU) 2019/944 OF THE EUROPEAN PARLIAMENT AND OF THE
COUNCIL of 5 June 2019 on common rules for the internal market for
electricity and amending Directive 2012/27/EU (recast)
Objective: The Union's energy system is in the middle of a profound change.
The common goal of decarbonising the energy system creates new
opportunities and challenges for market participants. At the same time,
technological developments allow for new forms of consumer
participation and cross-border cooperation. There is a
need to adapt the Union market rules
to a new market reality. It seeks to put
consumers at the heart of the transition – giving them
more choice and greater protection. Consumers will be able to become
active players in the market thanks to
access to smart metres, price
comparison tools, dynamic price
contracts and citizens' energy
communities. At the same time, energy poor and vulnerable
consumers will enjoy better protection.
30
Electricity
Directive
recast
Focus on the EU citizens - Consumers have
an essential role to play in
achieving the flexibility necessary to
adapt the electricity system to
variable and distributed renewable
electricity generation. Technological progress in
grid management and the generation of renewable electricity
has unlocked many opportunities for consumers. By
empowering consumers and providing them with the tools to
participate more in the energy market, including participating in
new ways, it is intended that citizens in the Union benefit from
the internal market for electricity and that the Union's
renewable energy targets are attained.
Member States and regulatory authorities should facilitate
cross-border access for new suppliers of electricity from
different energy sources as well as for new providers of
generation, energy storage and demand response.
31
Electricity
Directive
recast
ENERGY COMMUNITIES (decentralization)
The Directive aims to recognise certain categories of citizen
energy initiatives at the Union level as ‘citizen energy
communities’, in order to provide them with an enabling
framework, fair treatment, a level playing field and a well-defined
catalogue of rights and obligations. Household customers should
be allowed to participate voluntarily in community energy
initiatives as well as to leave them, without losing access to the
network operated by the community energy initiative or losing
their rights as consumers. Access to a citizen energy community's
network should be granted on fair and cost-reflective terms.
Citizen energy communities are considered to be a category of
cooperation of citizens or local actors that should be subject to
recognition and protection under Union law.
Citizen energy communities should not face regulatory restrictions
when they apply existing or future information and communications
technologies to share electricity produced using generation assets
within the citizen energy community among their members or
shareholders based on market principles.
See: Directive 2019/944: Preamble 46-49, Art. 16
32
Electricity
Directive
recast
CONSUMER EMPOWERMENT AND PROTECTION
Final customers shall have the right to a contract with their supplier that specifies …
Final customers shall be given adequate notice of any intention to modify contractual
conditions and shall be informed about their right to terminate the contract …
Suppliers shall provide final customers with transparent information on applicable prices
and tariffs and on standard terms and conditions, in respect of access to and use of
electricity services …
Switching supplier or market participant engaged in aggregation shall be carried out within
the shortest possible time …
All customers are free to purchase and sell electricity services, including aggregation,
other than supply, independently from their electricity supply contract and from an
electricity undertaking of their choice …
Member States shall ensure that at least household customers, and microenterprises with an
expected yearly consumption of below 100 000 kWh, have access, free of charge, to at
least one tool comparing the offers of suppliers (comparison tools)
Member States shall provide an enabling regulatory framework for citizen energy
communities.
Member States shall ensure that bills and billing information are accurate, easy to
understand, clear, concise, user-friendly and presented in a manner that facilitates
comparison by final customers. On request, final customers shall receive a clear and
understandable explanation of how their bill was derived, especially where bills are not
based on actual consumption.
Member States shall ensure the deployment in their territories of smart
metering systems that assist the active participation of customers in the
electricity market.
See: Directive 2019/943: Preamble 31-37, Art. 10,12,14,15
33
Electricity
Directive
recast
ENERGY POVERTY AND VOLUNERABLE CUSTOMERS
Member States should take the necessary measures to protect
vulnerable and energy poor customers in the context of the
internal market for electricity. Such measures may differ
according to the particular circumstances in the Member States in
question and may include social or energy policy measures
relating to the payment of electricity bills, to investment in the
energy efficiency of residential buildings, or to consumer
protection such as disconnection safeguards.
See: Directive 2019/943: Preamble 58-59, Art. 28-29
34
Regulation on the
internal market
for electricity
Regulation (EU) 2019/943 of the European Parliament and of the
Council on the internal market for electricity
It sets the basis for an efficient achievement of the objectives
of the Energy Union and in particular the climate and energy
framework for 2030 by enabling market signals to be delivered
for increased efficiency, higher share of renewable energy
sources, security of supply, flexibility, sustainability,
decarbonisation and innovation.
The share of electricity produced by renewable energy
sources is expected to grow from 25% to more than 50%
by 2030. At the same time, electricity must also be produced and
delivered in sufficient quantities when there is no wind or sun.
Markets need to be improved to meet the needs of renewable
energies and attract investment in the resources, like energy
storage, that can compensate for variable energy production. The
market must also provide the right incentives for consumers to
become more active and to contribute to keeping the electricity
system stable.
35
Regulation on the
internal market
for electricity
Regulation (EU) 2019/943 of the
European Parliament and of the Council
of on the internal market for electricity
In the future, customers need to be enabled to fully
participate in the market on equal footing with
other market participants and need to be
empowered to manage their energy consumption.
To integrate the growing share of renewable energy,
the future electricity system should make use of all
available sources of flexibility, particularly demand
side solutions and energy storage, and should make
use of digitalisation through the integration of
innovative technologies with the electricity system.
36
Regulation on the
internal market
for electricity
Regulation (EU) 2019/943 of the European Parliament
and of the Council on the internal market for electricity
Key concepts introduced by the Regulation:
1) Just Transition
2) EU DSO
3) Capacity Mechanisms
37
Regulation on the
internal market
for electricity
Just transition
(To ensure that no region is left behind in this transition, the
Commission launched the initiative for coal and carbon-intensive
regions in transition. Included as a non-legislative element of the
‘Clean energy for all Europeans’ package the initiative helps
mitigate the social consequences of the low-carbon transition.)
The Commission shall support Member States that put in place a
national strategy for the progressive reduction of existing coal and
other solid fossil fuel generation and mining capacity through all
available means to enable a just transition in regions affected
by structural change. The Commission shall assist
Member States in addressing the social and economic
impacts of the clean energy transition.
The Commission shall work in close partnership with the
stakeholders in coal and carbon-intensive regions, shall facilitate
the access to and use of available funds and programmes, and
shall encourage the exchange of good practices, including
discussions on industrial roadmaps and reskilling needs.
See: Regulation 2019/943: Preamble 51, Art. 4
38
Regulation on the
internal market
for electricity
EU DSO entity
In order to increase efficiencies in the electricity distribution
networks in the Union and to ensure close cooperation with
transmission system operators and the ENTSO for Electricity, an
entity of distribution system operators in the Union (EU DSO entity)
should be established. The tasks of the EU DSO entity should be
well-defined and its working method should ensure efficiency,
transparency and representativeness among Union distribution
system operators.
The Regulation introduced a new entity - European entity for
distribution system operators (EU DSO)
Distribution system operators shall cooperate at Union level
through the EU DSO entity, in order to promote the completion and
functioning of the internal market for electricity, and to promote
optimal management and a coordinated operation of distribution
and transmission systems.
See: Regulation 2019/943: Preamble 60, Art. 52-55
39
Regulation on the
internal market
for electricity
Capacity Mechanisms
It ensures that there is sufficient generation or load-management
capacity in the system to cope with times of stress on the network
when, for example, the wind stops blowing or there is a surge in
demand. The Capacity Market will provide back-up generators and demandside
responders to help balance the network at times of stress.
Participants will be paid a per MW rate for the capacity they offer to the
market. This capacity needs to be available when providers are called
upon by National Grid at any time during the contracted period.
The Regulation introduced a limit for powerplants eligible to receive
subsidies as capacity mechanisms (confirming the phasing out of
subsidies to generation capacity emitting 550gr CO2/kWh or more).
It seeks to ensure that electricity supply continues to meet demand as
more volatile and unpredictable renewable generation plants come on
stream.
See: Regulation (EU) 2019/943: Preamble: 48-50 Art. 21 – 23
40
Regulation on the
internal market
for electricity
Regulation (EU) 2019/943 of the European Parliament and of the Council of 5 June
2019 on the internal market for electricity (Text with EEA relevance.)
Capacity Mechanisms (2)
Ensuring an adequate, long-term energy supply is a paramount concern in Europe. EU
member states now intervene by encouraging investment in generation capacity,
offering an additional revenue stream for conventional power plants in addition to
the existing, heavily subsidised investments in renewable energy sources. These capacity
remuneration mechanisms (or simply capacity mechanisms) have become a hot topic in
the wider European regulatory debate. European electricity markets are increasingly
interconnected, so the introduction of a capacity mechanism in one country not only
distorts its national market but may have unforeseeable consequences for neighbouring
electricity markets. If these mechanisms are adopted by several member states with no
supra-national coordination and no consideration for their cross-border impact, they may
cause serious market distortions and put the future of the European internal
electricity market at risk.