Electricity Market Design

Any electricity market reform should focus on supporting the goals of the European energy policy:

Achieving a power system that is secure, affordable, sustainable and increasingly integrating renewable energy sources. Two different market design options are currently under discussion at EU level:
The establishment of Capacity Mechanisms (CM) or the further improvement of the Energy Only Markets (EOM), including prices which reflect actual scarcity.

EUGINE would like to highlight that only the further improvement of the energy-only market is a suitable solution, providing the right investment signals and which is compatible with the internal energy market.

To achieve a successful European energy transition at minimum cost, EUGINE recommends solutions which are European-wide, based on market forces and empowering market players:

1.    Turning the Energy Union communication into European solutions

1.1. Addressing the power system adequacy issue at EU level to make unilateral interventions (capacity markets, strategic reserves) unnecessary
1.2. Accelerating the Integration of the Internal Electricity Market (market coupling, network codes, policy harmonisation)
1.3. Strengthening investment signals (2030, ETS reform)

2.    Utilising market forces to develop flexibility at minimum cost

2.1. Investments should be driven by price signals (without caps), not by distorting interventions locking-in non-flexible and polluting technologies
2.2. Technology neutrality is needed to guarantee a level-playing field and a competition leading to reduced costs for society
2.3. Value for flexibility should be created to provide clear signals for investments in cost-efficient flexibility solutions

3.    Empowering market players to foster self-balancing and ensure security of supply

3.1. Sharing responsibility: All market participants should have the same balancing responsibilities
3.2. Cost-reflectivity: the imbalance charge paid by the participants creating imbalances should reflect the full costs (availability & utilisation fees)
3.3. Marginal pricing: “pay-as-cleared” pricing methodology for balancing energy would incentivise self-balancing and thus flexibility solutions
3.4. Shorter time frames are needed for a more dynamic, competitive and liquid procurement of reserves by TSOs and market participants


EUGINE contribution to the consultation on state aids for energy projects

State aid rules have a strong impact on the business case of environmentally friendly energy projects such as gas engines running on biogas or used for high-efficiency cogeneration (on-site combined heat and power production). EUGINE was therefore very pleased...more >


EUGINE Policy Navigator

After a legislative period mainly focused on the development of the electricity market and the adoption of the ‘clean energy’ package, the 2019-2024 legislative period should be focused on progressively decarbonising the gas grid as well as the heating, transport...more >


Electricity market design: two steps forward, one step back…

Following the adoption of Mr Karins’ report by the European Parliament’s energy committee, the EUGINE Secretary General Ralf Wezel expressed mixed feelings:

“The European Parliament is heading towards liberalised, much more short-term, dynamic and flexible electricity markets where scarcity prices play...more >


Key take-aways from flexibility study now available in German and French

10 key take-aways have been concluded from the study “Flexibility needs and options for Europe’s future electricity system”.

Here you can find the whole study and the 10 take-aways, the latter in German and French versions as well.

Download Study

The...more >


Position paper - Clean energy for all Europeans

Clean energy for all Europeans (2/3)
Governance regulation & RED II
Fostering renewables & flexibility solutions

EUGINE welcomes the European Commission’s legislative proposals aiming at further developing the various types of renewable energies and at meeting the EU targets through a consistent governance....more >


Electricity Market Design: “Market first” is the right way forward!

Following the publication of MEP Krišjānis Kariņš’ draft reports on the revised electricity regulation and directive, EUGINE Secretary General Ralf Wezel expressed his overall satisfaction:

“We fully share Mr Karins’ “market first” approach which definitely is the best option to foster...more >


Position paper - Clean energy for all Europeans

Clean energy for all Europeans (1/2)
Shaping a supportive market design

The market design proposals represent a unique tool and opportunity for EU decision-makers to both make the Energy Union happen and help Europe meet its climate and energy targets for 2030,...more >


EUGINE hosted discussion on Capacity Mechanisms in the European Parliament

Over 100 participants from the European Parliament, European Commission, representations of EU member states and energy policy lobbyists joined a dinner debate on capacity mechanism hosted by EUGINE on 22 March in the European Parliament.

Following an introduction by Ralf Wezel...more >


Electricity balancing: EUGINE's feedback on the draft guideline

EUGINE is the centre of knowledge for engine power plant technology and electricity market design. Its members are the leading European manufacturers of engine power plants and their key components. As flexible, energy-efficient, reliable and environmentally sound technology, engine power...more >


Adoption of MEP Langen's report on market design

Following the adoption of MEP Langen’s report “Toward a new energy market design” by the European Parliament on 13 September, EUGINE Secretary General Ralf Wezel expressed his satisfaction.

Read the entire press release


Capacity mechanisms: EUGINE contribution to the public consultation

The fact that 28 capacity mechanisms were found in the 11 countries selected by DG Competition shows to what extent the internal market threatens to be distorted and undermined by purely national considerations. EUGINE regards this sector inquiry as a...more >


Market design: EUGINE contribution to the public consultation

As centre of knowledge for engine power plant technology and electricity market design, EUGINE welcomed the consultative communication on market design the European Commission published on 15 July 2015. The European Engine Power Plants Association is pleased to have the...more >


Press Release: Full support of EUGINE for a new market design

The European engine power plant industry highly welcomes the consultative communication on the electricity market design published today by the European Commission. "This initiative of the European Commission can become a major milestone on the path to a functioning future-compliant...more >


Designing Electricity Markets - EUGINE recommends solutions for a Successful Energy Transition

To achieve a succesful European energy transition at minimum cost, EUGINE recommends solutions which are European-wide, based on market forces and empowering market players:

EUGINE - Background Paper on Designing Electricity Markets for a Successful Energy Transition


Position Paper - EUGINE response to German Greenbook consultation

EUGINE participated in the German Greenbook consultation.The EUGINE paper has been published on the website of the Bundesministerium für Wirtschaft und Energie (BMWi).

EUGINE response to German Greenbook consultation

EUGINE Beitrag zur Grünbuch Strommarkt Konsultation


Europe's Flexibility Challenge - a new EUGINE Brochure

Europe has sufficient electricity supply capacities – the real and growing challenge is to balance production and consumption in real time. Among the available options "flexible generation" is the only large scale technology that is available, affordable and proven to...more >