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IFIEC Energy Forum 22 November 2011. Electricity. Contents. Pricing mechanism Market integration Climate Policy and renewables Structural elements. Pricing mechanisms. Efficient, liquid, competitive and transparent market platforms
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IFIEC Energy Forum 22 November 2011 Electricity
Contents • Pricing mechanism • Market integration • Climate Policy and renewables • Structural elements
Pricing mechanisms • Efficient, liquid, competitive and transparent market platforms • Access to long term competitive contracts on normal market conditions • Long term visibility of electricity prices • Accelerate work on forward markets in Target Model • Day-ahead market is key • All available capacity should be offered • At marginal cost+ • Intraday and balancing markets are “corrective” markets only • On cross-border: no OTC • Capacity markets: • Risk of paying the highest price for both capacity and electron • Better ways to stimulate investments
Market integration • Necessary for effective competition AND better security of supply • Investments in additional grid capacity if it brings value to the end customer (as long as it is economically justified) • Make optimal use of existing capacities • Target model: • Coordinated flow-based capacity calculation • Smaller bidding zones are OK, but price zones cannot be reduced in size but rather increased!
Climate Policy and Renewables • ETS: compensation for exposed industries are essential as long as no international commitment exists: • 100% compensation • No decrease over time • Integration of renewables • - impact on the market • - fuel cost – marginal pricing • - intermittence • - impact on grid (costs) • - impact of support schemes on overall electricity cost
Structural elements • Transparency • IFIEC in principle welcomes additional transparency rules (REMIT / MAD / fundamental power data / ...) but we oppose for additional administrative or financial burdens for industry • Consultation processes (ACER / Florence Forum / EC / ENTSO-E) • IFIEC supports the consultation process and will contribute with all its available resources • Closed Distribution Systems • IFIEC insists on workable solutions in EU member states