Title: Annex: The interaction between the EU ETS and European electricity markets
Abstract: The launch of period 1 of the EU ETS in January 2005 coincided with a particularly turbulent period in Europe's electricity markets. Two directives of the European Commission, Directive 2003/54/EC (internal electricity market) and Directive 2005/89/EC (security of electricity supply), advanced the objective of complete liberalization of electricity and gas markets in the European Union. In parallel, Europe experienced an intense process of industrial concentration, with a de facto transnational oligopoly emerging around EDF, E.ON, Enel-Endesa, RWE and GDF Suez. Coupled with the intrinsic short-term inelasticity of electricity demand, the absence of storage and electricity's importance as an essential good for households and industry, the establishment of wholesale markets outside national regulatory oversight and the movement towards concentration have repeatedly given rise to suspicions of the abuse of market power. To top it off, western and central Europe experienced severe cold snaps, in the winters of both 2004/5 and 2005/6, which, in conjunction with low hydro-power levels, led to dramatic high price spikes during the first phase of the EU ETS.
Publication Year: 2001
Publication Date: 2001-01-01
Language: en
Type: other
Indexed In: ['crossref']
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Cited By Count: 6
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