The marginal energy price model has made wholesale electricity expensive in times of costly natural gas.The European Commission is under “very strong political pressure” to overhaul the market to cut the soaring bills for consumers.The European Union is working on proposals designed to decouple gas prices and renewable energy prices in what could be a major overhaul in the bloc’s power market amid an unprecedented crisis.
“However, in the current energy crisis, marginal pricing means that wholesale electricity prices are largely set by the price of gas ,” the European Parliament said last year. A draft proposal seen by FT suggests that the Commission could offer to extend the windfall tax on renewable energy companies, with proceeds from the levy passed on to EU consumers.
Exhibiting their incompetence in solving the energy crisis
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Brussels plans energy market overhaul to curb cost of renewables\n\t\t\tExpert insights, analysis and smart data help you cut through the noise to spot trends,\n\t\t\trisks and opportunities.\n\t\t\n\t\tJoin over 300,000 Finance professionals who already subscribe to the FT. Fundamentally the market reform is supposed to curb the profits, not the cost of renewables.
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