September 23, 2019 (06:05)

The 7th Vienna Forum on European Energy Law

On September 19-20, 2019, the 7th Vienna Forum on European Energy Law was held in Vienna under the organizational support of the Secretariat of the Energy Community and the Florence School of Regulation. This event has a private reception, which discusses the most topical issues of energy law between representatives of the EU institutions and European business. The main topics discussed at this year’s forum were global climate and decarbonization issues, geopolitical issues, renewable energy support mechanisms and innovations that are reforming the electricity market: new players, capacities and processes.

Andris Piebalgs, former European Commissioner for Development at the European Commission led by Jose Manuel Barroso, and now Advisor to the President of Latvia and Professor at the Florence School of Regulation, called for the prospects of a significant increase in the share of electricity and overall end-use energy in the formulation of national energy policies, development of RES and accumulation systems, decentralization of generation, digitalization, the need for infrastructure development and decommissioning of coal power plants. It is also proposed to develop all areas of energy policy, taking into account the leading role of energy efficiency. A new phenomenon in the near future may be the industrial use of hydrogen, the production of which will create additional demand for electricity and, at the same time, new industries in the structure of national economies.

Power storage systems have been the subject of much debate. The head of the European Association for Storage of Energy proposed to split the commercial and technological use of electricity storage systems for the needs of balancing the grid. The latter proposes to allow transmission and distribution system operators to operate subject to certain requirements. In particular, the choice of the most appropriate technology should be made in conjunction with the national energy regulator, the capacity of such accumulation systems should be consistent with the obligations of operators to maintain the reliability of the network, and the right to use should be reviewed on a regular basis with regard to competition in the market. The Association calls on the EU to publish an official position on the ownership of storage systems as soon as possible, as uncertainty is an obstacle to the implementation of investment projects on storage systems.

New players in the European electricity market will be prosumers or active consumers who can own both microgeneration and storage systems and participate in the electricity market on their own or through aggregators, as well as energy communities (energy cooperatives) that, in addition to generating and storage systems, can own distribution networks and participate in cross-border electricity trading.

The European Commission marked the increasing role of digital technologies in the modern grid and its functioning, which creates additional benefits and threats, in particular for the operation of transmission and distribution system operators. Ensuring consumers’ freedom of choice of a supplier, remote management and data transmission must also be effectively combined with enhancing cybersecurity and personal data protection. Regulation (EU) 2019/941 on risk preparedness in the electricity sector obliges EU Member States to include cybersecurity measures in their national risk assessment plans, whereas the new Regulation (EU) 2019/943 on the internal electricity market provides for the development of a network code on cybersecurity in the electricity sector.

Representatives of “NAVIGANT”, the international consulting company, drew attention to the specifics of preparation and holding of green auctions and warned against transferring the model of one country to another without taking into account national priorities of energy policy, specifics and choice of available technologies, market structure and socio-institutional context. It is very important to have a proper balance of market potential and the volume of RES being marketed, as well as an estimate of the number of potential bidders, the relationship between them, the potential risk of collusion and the financial conditions at which investors will be interested in participating in the auctions.

The Vienna Forum on European Energy Law is an important platform for communication between representatives of European institutions, national authorities and business. Today, the European Commission continues to convey the value of innovations to the electricity market participants and identify loopholes in the legislation with a view to further correcting them.

Network operators are becoming an increasingly important part of the new electricity market in the EU, as they are committed to ensuring that the grid operates in a rapidly changing generation structure, an increase in fragile RES and an increasing role for demand management. This increases the need to coordinate the work of transmission and distribution system operators, which need to build effective collaboration to balance the grid using available technical solutions for both the generation and consumption sides.

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