Towards a Common European Electricity Market

Abstract

This paper analyses the future organization of cross border trade in the European electricity market. The draft Regulation “on Conditions for Access to the Network for Cross-Border Exchanges in Electricity” issued in March 2001 by the European Commission together with related documents produced by the European association of Transmission System Operators (ETSO) and the Council of European Electricity Regulators (CEER) until that date constitute the backbone of this analysis. The paper examines whether the economic principles contained in these documents suffice to design a working European electricity market and if not, what is missing. It concludes that these principles need to be completed by harder measures in order to induce the “real integrated single market” of electricity claimed by the Commission. In short, the principles may be necessary, but they are unlikely to be sufficient.

The More Cooperation, The More Competition? A Cournot Analysis of the Benefits of Electric Market Coupling

“…If network capacity constraints are binding, our full network representation is analogous to an assumption that the TSOs run efficient balancing (real-time) markets to clear intracountry congestion. Boucher and Smeers (2002) point out that, in reality, within-country congestion in the EU is run inefficiently. However, we believe that ours is an acceptable approximation, as network constraints rarely bind in our solutions, and the path constraints are more important economically.…”

“…Haubrich et al (2001) detail the conservative nature of the interface limits. Boucher and Smeers (2002) critique the inefficiencies that result from simplifying transmission constraints into a few between-country interfaces. The order of magnitude of the conservatism can be appreciated by noting that the sum of the individual power line capacities into the Netherlands is 11,600 megavolt-amperes.…”

“…Haubrich et al (2001) detail the conservative nature of the interface constraints Boucher and Smeers (2002). critique the inefficiencies that result from simplifying transmission constraints into a few between-country interface constraints.…”

Energy Transition Towards a Greener and More Competitive Economy: The Iberian Case

“…There is plenty of literature on this issue with regard to both the setup and characteristics of the competitive electricity market-for example, ref. [20] analyzes whether the legislation to be implemented was consistent with the principles underlying the creation of an integrated single market and conclude that it was indeed insufficient-and the results of the very wide-ranging deregulation processes. Ref.…”

Coordinated spot market for congestion management of inter-regional electricity markets

“…However, associated with these initiatives, there is a lack of clear specification on harmonization requirements-defining key elements of market design. For instance, due to the great diversity in existing pricing structures in the EU, a real integrated electricity market requires further harmonization to avoid diverging national solutions, adverse to the internal market design and development [4]. Existing regional power exchanges such as the Nord Pool [5] or recent proposals in the Northeast U.S. and Canada [6] (which are based on a real compromise for a regional Manuscript received April 15, 2003.…”