Brussels needs fixed electricity prices, neighbors share solar and regulation amid crisis

The European Commission advocates in the reorganization of the European electricity market the promotion of term contracts to avoid peak loads, the sharing of renewable energy sources such as rooftop solar and even price regulation in crisis situations.

The measures are part of a proposal to reform the structure of the European Union (EU) electricity market to encourage the use of renewable energy, better protect consumers and increase the competitiveness of industry, published on Tuesday by the Community Executive, in which the European institution defends how Lusa has already moved forward, ” a wide range of contracts” so that European clients “are able to set safe prices in the long term to avoid excessive risks and volatility”.

In its proposal, the European Commission also supports the option of “dynamic price contracts to take advantage of price volatility to use electricity when it is cheaper”, such as charging electric vehicles or using heat pumps, requiring “suppliers to manage their price risks at least least, up to the volume limits stipulated in the fixed contracts, in order to [os consumidores] be less subject to market spikes and volatility,” the press release reads.

In order to protect the most vulnerable consumers (families or small businesses), Brussels invites Member States to act on retail prices in times of crisis to prevent blackouts for those with delinquent bills, and asks countries that have not established suppliers of the latter instances.

The idea, according to the proposal, is that when a crisis situation is declared in the EU, member states are expected to intervene to “extend regulated retail prices to households and small and medium-sized companies” for a certain period and without distorting the market, as this happened during the current energy crisis.

Another consumer protection measure is the possibility of sharing renewable energy sources at a time when the rules at the European level are “also being reformulated”.

“Consumers will be able to invest in wind or solar parks and sell excess solar power to neighbors, not just their supplier, and for example, tenants will be able to share excess solar power on rooftops with a neighbor,” the European Commission suggests. .

In addition, in order to increase the flexibility of the energy system, Member States are expected to adopt supportive measures to increase accumulation.

The proposal also mentions targets to reduce EU gas consumption to reduce pressure on prices, while Brussels notes that “based on the experience gained during the “energy crisis”, the reform expands” the package of measures to reduce gas consumption in the energy sector. sector”.

“The more we support the development of renewable energy […]the less our electrical systems will depend on the production of fossil fuels and the lower the price of light will be,” the European Commission’s proposal says.

In Portugal, the current energy saving plan provides for a reduction in energy consumption of 15%, as envisaged for the entire EU, albeit with derogations, given the national situation, which reduce the mandatory reduction to 7%.

EU electricity prices have risen sharply in recent months, sparking criticism of its gas price-driven formulation, a situation the European Commission wants to reverse.

In the current configuration of the European market, gas determines the global price of electricity when it is used, since all producers receive the same price for the same product — electricity — when it enters the grid.

There is a consensus in the EU that the current marginal pricing model is the most efficient, but the acute energy crisis exacerbated by the war in Ukraine has sparked debate given Europe’s dependence on Russian fossil fuels.