In order to avoid last year’s scenario in which bills exploded and the population was looking for solutions to pay them, analysts believe that the solution to reform the electricity market imposed by the Executive will have positive effects. In this way, the industry will no longer suffer and the citizen will pay the right price, writes economica.net, according to Reuters.
The European Commission presented several options in a public consultation on Monday to overhaul the way power stations sell electricity. The reform will be proposed, however, precisely in March.
“We need to design a viable electricity market in the future, which allows the benefits of clean energy to be delivered to everyone”transmitted Kadri Simson, the European Commissioner for Energy.
The proposals focus on the expansion in Europe of long-term contracts – CfD (Contracts for Difference) and PPA (Power Purchase Agreements). These contracts provide power plants with a fixed price for the electricity they produce. This extension would create a safety zone between the consumer and the changing prices in the energy market. Their result would be a stable level for companies and households, emphasizes the European Executive.
The way to the expected results will be discovered through public tenders for renewable energy. These will have to include PPAs or credit guarantees from the state for firms signing power purchase agreements.
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Will the power plants only sell electricity by contract?
Among the tougher measures that the European Commission has considered is the CfD solution. This lies in the willingness of power plants that receive state support to sign contracts for the difference. A second solution is the mandatory imposition of these types of contracts, but this is accompanied by risks, the EC emphasizes.
“Such a change would represent a risk to the necessary investments in this type of electricity generation, it could increase the costs of the investment, so it could be counterproductive,” says the Executive.
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