FOROTOM issues response to EC market design

FORATOM issued a response commending the European Commission’s (EC) intention of pushing for the reform of European energy generation, they announced on Oct. 8.

According to the announcement, the EC is expected to be revealing legislative proposals relating to the electricity market in 2016. FORATOM reports that over the past 10 years increasing renewable power generation was made possible due to subsidies from governmental entities. As a result, this has lead to overcapacity and decreasing averages in spot prices and the replacement of some gas power facilities with coal powered facilities. The organization states that this affects the nuclear generation fleets with risks of premature shutdowns and halting or postponing future construction.

For new market designs, FORATOM suggests that energy will have to allow flexibility and that a single objective should be avoided when developing it, specifically in relation to the intermittency of renewable sources of energy. The current market is not conducive to investment incentives toward low-carbon generation, and this area should be a point of focus for the EC.

FORATOM recommends that the EC should take steps to unveil drivers for price increases and aim for increased transparency. They also request that national governments and regulators remove unrelated taxes and levies on energy.

FORATOM is a advocacy organization for nuclear generation in Europe.