Powerful power markets - 5 key policy asks on market design
Construction workers near Workington UK, installing the power cable that will carry the electricity from the Robin Rigg offshore wind farm.
The transition to an efficient, renewables based energy system will require the electrification of large parts of sectors like transport, buildings, and industry.
This will lead to an increase in electricity demand.
So it is imperative that Europe’s power system is completely decarbonised. EU policy makers have to provide the signals that give market actors the confidence they need to invest in this change.
The European Commission has made some positive proposals. But more can be done to integrate energy efficiency, demand-side response, and renewable energy into the EU’s power system.
WWF's five key asks - outlined in this paper - are as follows:
1. Sensible smart retirement
Managed closure of the most polluting and inflexible power stations to end the glut of old, high-carbon, generation capacity on EU power grids
2. Robust resource adequacy assessments
A common methodology to objectively assess whether an electricity system’s resources can deliver energy security
3. Careful capacity markets
Markets that, if needed, only support and do not hinder the transition to a clean power system
4. Markets made for demand response and renewables
Ensuring the EU’s power system is set up to encourage efficient flexible demand that is met by sustainable variable supply
5. Guaranteed grid access
Retain guaranteed access to the grid and priority dispatch for variable renewables until markets work better