Market design must be more coordinated to achieve ambitious climate targets

Today, Dr Christoph Riechmann, Director in Frontier’s Energy practice, presented at the 29th meeting of the EU-Russia Gas Advisory Council’s Work Stream on internal market issues (GAC WS2).

In his presentation on regulatory design for an integrated decarbonisation of the electricity and gas sectors, Christoph pointed out that a better coordinated market and regulatory design is necessary in order to achieve the ambitious climate targets the EU has set itself.

Market design and regulation of  the electricity and gas sectors therefore needs to be consistent and technology-neutral in a range of areas. Christoph explained the regulatory barriers and gaps that Frontier identified in recent work.

A range of solutions are available to make regulations and market design more consistent, including:

  • adapting climate policies and providing support for innovation  in the gas sector;
  • using regulatory tools to address cost recovery issues;
  • a review of tariff systems as well as taxes and levies across the electricity and gas sectors to create a level playing field;
  • providing clarity on access to infrastructure especially for new forms of low carbon gases; as well as
  • introducing coordinated infrastructure planning and decommissioning.

Frontier regularly advises clients on EU energy policy in the gas and electricity sectors.

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