MEPs back new rules to make power market ‘cleaner’ and prevent blackouts

They have adopted four new laws on the EU electricity market under the Clean Energy for All Europeans package

New rules to create an electricity market that is cleaner, more competitive and better able to cope with risks have been approved by members of the European Parliament (MEPs).

They have adopted four new laws on the EU electricity market, which were agreed informally with EU ministers in late 2018, under the Clean Energy for All Europeans package.

One of the main objectives of the new rules is to allow at least 70% of trade capacity to cross borders freely, making it easier to trade renewable energy and support the EU’s binding goal of 32% renewables by 2030.

EU rules currently allow national authorities to pay power plants to be on stand-by for a limited period of time if there is a demand peak, under capacity market schemes. The new rules will introduce stricter limits for member states subsidising power stations to prevent the most polluting fossil-fuelled power plants in Europe from receiving state aid.

The measures will apply to new power plants from when the rule enters into force and to existing ones from 2025.

Consumers are also expected to benefit from the new regulations, with access to smart meters, dynamic pricing and the option to switch providers at no cost within a maximum period of three weeks – and 24 hours by 2026.

Member states will also still be able to regulate prices temporarily, under strict conditions, to help and protect fuel poor or vulnerable households, with social security systems becoming the primary means of addressing fuel poverty.

They will also be required to draft national plans to assess the risk of power supply shortages and co-operate at regional levels and member states receiving assistance from other EU nations will have to ultimately bear all “reasonable costs” associated with it.

Miguel Arias Cañete, Commissioner for Climate Action and Energy welcomed the news, adding: “I thank the European Parliament for its strong support for the clean and fair energy transition, taking the EU a step closer towards delivering the Energy Union with citizens at its core, one of the key priorities President Juncker set out for this Commission.

“[The] approval of the new electricity market design will make energy markets more flexible and facilitate the integration of a greater share of renewable energy. An integrated EU energy market is the most cost-effective way to ensure secure and affordable supplies to all EU citizens. I am particularly pleased that we have agreed on a common framework for capacity mechanisms that will ensure such mechanisms will be in line with our climate objectives in the future while taking into account legitimate security of supply concers.”

The agreements will now have to be officially approved by EU ministers and published in the Official Journal of the EU before they can enter into force.

Latest Podcast