The Regulation of Power Exchanges in Europe

Description

Historically, the electricity industry around the world has been organised as public or private, generally as vertically integrated monopolies. During the last decade, dramatic changes have been taking place as a result of the liberalisation process. In Europe this process has been initiated by the entry into force of the first EC Electricity Directive in 1996. The clear objective of this process is to create a competitive single European electricity market. This ambitious project has involved many reforms and intense re-regulation but does basically not include instruments of market design such as trading arrangements and the establishment of specific market institutions.br At the wholesale level, one of the important developments is the establishment of organised electricity markets, i.e. power pools and power exchanges, which play an increasingly important role. This is not only illustrated by the actual number of exchanges that have been established over the years, but also by their increasing share within the national electricity markets. Surprisingly, the literature describing and analysing these exchanges in Europe is almost nonexistent.br This volume represents an initial effort to analyse the role of power exchanges in Europe and evaluate their impact on the European electricity industry. The introduction presents the general framework of the book and analyses the reasons and conditions for the establishment of power exchanges in Europe. The following chapters examine the establishment of an organised market before the enlargement of the European Union and thus cover the developments in the Nordic area, the United Kingdom, the Netherlands, Germany, France, Austria, Spain and Italy. With the exception of the establishment of the power pool in Spain, this north-south approach coincides with the lifetime of these new market places. Finally, the concluding chapter provides a theoretical approach. It examines the legal nature of power exchanges and presents several alternatives for their legal basis and the regulation applying to them such as state regulation or self-governance.nbsp;br