Europex response to the CEER Public Consultation on Dynamic Regulation to Enable Digitalisation of the Energy System

Brussels, 14 May 2019 | The CEER Consultation Paper on Dynamic Regulation to Enable Digitalisation of the Energy System elaborates on the implications of digitalisation for the energy sector and for consumers in particular. It considers the changes that may be needed to empower and unlock the benefits of digitalisation for consumers and to protect them against the risks.

Selected highlights from the Europex response to the consultation are included below.

B1. What impact do you consider that digitalisation will have on the energy system and which are the most important?

Digitalisation will enable the emergence of new business models and complementary markets on adecentralised and more “local” level, with the potential to enable new players to access organisedmarkets and benefit from a wider set of reliable short and long term price signals. As the number of players and market participants grows, so does the need for access to transparent and reliable price signals. Therefore, power exchanges and delegated operators1 see their role growing in an increasingly digitalised and decentralised power system.

B2. What are your views on the changes for the energy system highlighted in chapter 2 of the consultation paper (a. Increases the productivity of the existing system; b. Enables new products and services that alter electricity demand and; c. Brings new digital marketplaces that transform the way the sector transacts?) And are these the most relevant?

While digital solutions have long been central to the development of the wholesale energy market, new digital market places offer new tools to help the power system to adapt to the trends identifiedby CEER, and additional opportunities to involve ‘prosumers’ and intermediaries such as aggregators.

In the context of growing RES production, power exchanges have pioneered market-based solutions to manage and reduce local congestions. Regional and local flexibility markets allow for the further integration of renewables and foster flexibility as a complement to the European wholesale markets, including Single Day-ahead Coupling (SDAC) and Single Intraday Coupling (SIDC).

Local flexibility markets can provide a clear and transparent price signal allowing more optimal activation of the local flexibility sources for, among others, local DSO and DSO-DSO and DSO-TSO level congestion management.

By acting as neutral facilitators between TSOs, DSOs and flexibility providers, power exchanges and delegated operators have a key role to play in an increasingly digitalised and decentralised energy system.

Peer-to-peer trading (e.g. through blockchain technology) also has the potential to respond to consumer flexibility needs on a micro/local level, encourage consumer empowerment. However, it is important to ensure that power exchanges can facilitate the development of these solutions, while continued connection to wholesale markets will contribute to the protection of European consumers.

Please see the full consultation response attached.