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ACER recommendation to divide the German-Austrian energy market is a step backwards for Europe

ACER, the European agency of energy market regulators, released a statement today, September 23rd 2015 regarding the Austrian-German common electricity market zone. In the policy brief, it is recommended that the common market area be split. The Austrian Power Grid AG recognises in this suggestion a large step backward for the integration of the European electricity market.


More Europe is the solution for the electricity supply

One of the most important aims of the European Union has been the creation of a common European internal market. In the electricity industry, only in the last two decades have real advances toward market integration been achieved. With their infrastructure, the European transmission system operators for electricity are establishing the physical foundations necessary for the completion of the European energy market. They are undertaking great efforts to bring the national markets closer together. They have developed common standards for the organisation and security of their systems and have strengthened cross-border cooperation in all sectors. The ACER recommendation to disband, with the German-Austrian market zone, the only cross-border electricity market currently functioning in Europe would mean a massive step backward for the project of creating a European internal market.


Functioning EU internal market as a basis for supply security

The ambitious EU goals for expanding electricity generation from renewable energies represent a challenge for Europe as a whole. The European electricity supply can only be reorganised on the basis of renewable energy sources in a long-term and sustainable way if supply infrastructure and systems are updated throughout Europe. A functioning pan-European electricity market is a pre-requisite for the success of this project. It is the basis upon which the security of Europe's electricity supply can be guaranteed sustainably and for the long term.


ACER recommendation is missing the pan-European perspective

The catalyst for the current ACER policy brief was a challenge from the Polish regulatory authority that attributed excessive burdens on the Polish electricity grid to the electricity imports from Germany to Austria. However, in its assessment, the ACER statement only makes reference to retrospective observations. Future developments such as grid expansions and innovative measures to manage bottleneck are not taken into account at all. The pan-European perspective is missing, as well.

Comprehensive analysis should be awaited before policy decisions are made

In the context of its so-called bidding zone study, the European Transmission System Operators Association (ENTSO-E) is now investigating the technical and economic efficiency of the current market zones in Europe. According to the EU Regulation on Capacity Allocation and Congestion Management (CACM) effective as of 14.8.2015, the bidding zone study is meant to be carried out every three years. The result of the investigation currently underway will be available mid-2016. According to APG, the analytical process currently running and decided upon in Europe from the side of the transmission grid operators should be brought to a conclusion, and appropriate measures toward the alleviation of the pan-European grid situation should be worked out on the basis of the findings of this investigation.