Opening of the european market for electricity
(2000)
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OPENING_OF_THE_EUROPEAN_MARKET_FOR_ELECTRICITY.pdf
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- undation Industry-University in 1997. For its medium-term generic research, it concentrates on two major subjects: the Kyoto protocol for greenhouse-gas reduction and its consequences and the effects of the liberalisation of the European market for electricity. The first report, formally published on May 31, 1999, dealt with the Kyoto protocol. This second report deals with the liberalisation of the electricity market. After a year-long process of negotiations between the European Member States, the Directive 96/92/EC on common rules of the internal market in electricity was adopted on December 19, 1996. It entered into force two months later, and gave Member States two years to comply. Although there was a delay in some Member States, all have now implemented the Directive. However, strong harmonisation efforts are still needed, particularly on cross-border transmission and congestion management issues, before the 15 separate countries form one European wide internal market. Belgium is located at the very heart of the European electricity network. This also means the Belgian network is particularly influenced and on occasion even threatened by the growing number of, sometimes unannounced, international transactions. In order to ensure a safe and reliable system operation, and in order to prevent a system-wide black-out, it is essential that proper agreements are made between the European system operators and regulators. In this process, Belgium could play a central role. The liberalisation in Belgium is moving ahead, although a lot of decisions are still awaiting the advice of the regulator. Some major industrial companies have switched producers, and for the not-yet eligible SME and households, tariffs drops are promised. In this context, it is interesting to provide an overview of both European and local developments. The first part of the report deals with the European background, describing the Directive and the harmonisation efforts, as well as the state of the implementation in the most relevant and neighbouring European countries. The report also describes the fundamentals of trading and price setting. The second part of the report focuses on Belgium. Starting from the pre-liberalisation situation, the present state of the implementation is described, with some attention to the various calendars that have been proposed for opening up the market. The report continues with the results of two studies that have been performed by the K.U.Leuven research groups that make up the Energy Institute. The first deals with the issue of stranded costs, and more specifically stranded costs in Belgium. The second deals with transmission pricing. It presents general pricing criteria, applied to electricity transmission, and the modified postage stamp transmission tariff for Belgium, as proposed by the K.U.Leuven. For the moment, distribution is only touched upon slightly. In future, the impact of the liberalisation on a distribution level will be studied in more detail. The report was ready in draft form in December 1999, and presented to the members of the Energy Foundation. We gratefully acknowledge their comments, and have taken them into account for the present version
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Van Roy, P., Belmans, R., Proost, S., Willems, B., & Conings, L. (2000). Opening of the european market for electricity. https://hdl.handle.net/2078.5/256003