This week, on 19 December, the Austrian Presidency of the Council of the EU and the European Parliament have reached a final provisional agreement on the Electricity Market Design Directive and Regulation after half a year of intense negotiations. It was for the Austrian Presidency a main priority to find a good compromise for the electricity files before handing them over to the next Presidency, the Romanian Presidency. “It is an important step towards the completion of the Energy Union and puts us firmly on the path to deliver our contribution to the Paris Agreement”, states Ms Elisabeth Köstinger, Minister for Sustainability and Tourism of Austria and chair of the Council at the press conference on Wednesday. These were the last files of the European Commission’s Clean Energy Package published in November 2016 aiming to facilitate a clean energy transition for all Europeans. CEEP welcomes the decision made by the European legislators and pleaded for a functioning European internal energy market as the basis for the achievement of the EU’s climate and energy objectives in the short and long term, whilst creating a fair and level-playing field for all market actors and ensuring a well-balanced competitive energy market.

For the next legislative step, both files will be discussed by EU Ambassadors who will approve and endorse the deals. The formal adoption by the Parliament and the Council will take place later.

Here is a short overview of the decisions made for each file:

Electricity Directive

  • Empower consumers and defines active consumers by giving more rights and direct market participation whilst protecting vulnerable customers
  • Allow customers to switch suppliers within 24 hours by 2026
  • Enable electricity providers to set their own prices to limit market distortions and enhance a higher market competition to lower retail prices
  • Define roles and responsibilities of new market participants
  • Allow Members States to apply regulated prices to vulnerable household customers
  • Allow Member States to apply public interventions in price setting for the supply of electricity for other household customers and micro-enterprises to ease the transition period and increase competition

Electricity Regulation

  • Set conditions for Member States to establish Capacity Mechanisms to ensure sufficient electricity supply during peak demand times by remunerating resources for their availability
  • Emission limits of 550 gr CO2 of fossil fuels per kWh of electricity
    • New power plants emitting more than the limit describes are excluded from the Capacity Mechanism
    • Existing power plants emitting more or on average 350 kg CO2 per year per installed kW may continue until 1 July 2025 in the capacity mechanisms
  • Regional Coordination Centres will have additional tasks related to system operation, market operation and risk preparedness

DSO Entity was also adopted and will include all DSOs of every size.

If you have any more questions on the Clean Energy Package or on the next legislative steps, our Policy Officer Henriette Gleau will answer all your remaining questions. (henriette.gleau@ceep.eu)

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