The European Commission proposed a revamp of Europe’s electricity market rules on Tuesday, to try to increase the use of fixed-price power contracts, shield consumers from price spikes and speed up the shift to renewable energy.
For example, EU countries’ state support for new investments in wind, solar, hydropower, geothermal and nuclear electricity must be done through a two-way contract for difference . CfDs pay generators a fixed “strike price” for their electricity, regardless of the price on short-term energy markets. After soaring energy prices led to insolvencies and forced governments to prop up cash-strapped companies this winter, the proposals require countries to appoint a “supplier of last resort” so consumers have a backup if their energy supplier fails.
EU countries and the European Parliament must negotiate and approve the reforms, with some pushing for a final deal this year.