ACM: promote sustainability through European collaboration
European collaboration can make the production of sustainable energy more efficient, and it may speed up the transition towards a future with a higher share of sustainable energy.
That is the conclusion the Netherlands Authority for Consumers and Markets (ACM) draws following the presentation of its vision document in which it outlines its priorities with regard to the wholesale markets for electricity and natural gas.
‘If it collaborates with other countries, the Netherlands does not have to be self-sufficient, thus making energy cheaper,’ Henk Don, Member of the Board of ACM, comments. ‘Collaboration is also important for stimulating a higher share of sustainable-energy production, because, that way, we can make sure that the transition towards a sustainable economy will be less costly.'
European countries currently use different methods to stimulate increasing the share of sustainable-energy production. These differences lie in, for example, taxes or subsidies for coal, or in options for consumers to inject electricity back into the grid for a compensation. According to ACM, preventing such disruptions to the internal market ensures that investments are made as efficiently as possible. For example, new wind turbines can be built on locations with the highest efficiency, rather than on locations that bring in the most subsidies.
Furthermore, each country has a different way of dealing with market problems arising from the increase (gradual or rapid) of the share of sustainable energy. For example, several neighboring countries introduced extra payments to electricity producers for making production capacity available. ACM argues that it is not a desirable situation if individual capacity mechanisms such as these are set up, because it is not efficient if every country creates additional capacity individually without taking into consideration capacity in other countries.
The consultation round organized by ACM reveals that the vast majority of stakeholders endorses ACM’s priorities with regard to the wholesale markets for electricity and natural gas for the next three years. These priorities are:
- Completing the European market integration process, in particular by implementing European regulations, and, wherever possible, going ahead with the process in anticipation of the finalization of such regulations;
- Creating optimal conditions for markets to function efficiently, in particular by implementing and enforcing European rules on transparency and market integrity;
- Safeguarding security of supply in a future with a higher share of sustainable energy.