As Europe moves towards greater electrification, retail energy markets will increasingly shape the costs and opportunities for consumers. How electricity is priced and how consumers can respond to changing prices will influence whether households can benefit financially from this transition.

The 2026 Monitoring Report on retail energy markets examines electricity bills, affordability and what the shift to electrification means for consumers. 

What trends did the monitoring find? 

• Household retail prices rose sharply after the 2022 energy crisis and have remained elevated. In 2025, EU households spent an average of €840 on electricity and €1,170 on gas.

• Household electricity expenditure ranges from 1.2% to 3.9% of national median income across the EU, reflecting differences in prices, consumption and household income.

• High electricity-to-gas price ratios can weaken the incentive to electrify. Electricity remains relatively expensive compared to gas, discouraging households from switching to electric technologies. Network charges, taxes and upfront costs often widen this price gap further.

• Most consumers are not exposed to the benefits of flexibility. 7% of EU households are on dynamic price contracts, while over 80% in nine countries are on single fixed-term, fixed-price electricity contracts. This limits their exposure to changing price signals and potential savings. Smart meter rollout is also uneven across Member States: 66% of monitored customers have a smart meter, but coverage remains below 20% in several countries.

• Flexible consumption could reduce bills. ACER analysis shows that switching to dynamic pricing and shifting consumption to lower-price periods could have saved households an average of 20% (around €120) on their electricity bills in 2025. 

• Better contract monitoring is needed to assess consumer outcomes. More complete and comparable contract data are key to assessing market impacts on European consumers.

Looking ahead

Electrification will increase electricity consumption and change when and how consumers use energy, creating new challenges for retail energy markets.

Three areas will be particularly relevant:

• Making electrification financially attractive. Retail electricity prices relative to fossil-fuel prices, technology efficiency and upfront investment costs will shape incentives to electrify.  

• Ensuring network investment delivers value for consumers. Efficient planning and use of existing grids will help contain costs and protect electricity affordability as network investment increases.

• Enhancing monitoring of energy retail contracts to understand consumer choice. Better data on the contracts consumers actually choose will help assess whether appropriate price signals and choices are available as consumption patterns change.

Today, ACER published its Opinion on gas and hydrogen national Network Development Plans (NDPs), assessing alignment between national and EU-level planning.

NDPs are national roadmaps prepared by gas transmission system operators (TSOs) and hydrogen network operators (HNOs) across EU Member States. They set out how each country’s networks should develop in the next decade(s) to meet evolving energy needs. Efficient planning helps ensure the right level of network investment, meeting network users’ needs without unnecessary costs.

What is ACER’s role?

Every two years, ACER assesses how well national plans align with the EU-wide Ten-Year Network Development Plan (EU TYNDP), prepared by the European Network of Transmission System Operators for Gas (ENTSOG).

The EU TYNDP is a non-binding plan that sets out how gas and hydrogen infrastructure across Europe could develop over the coming decade, assessing future system needs. It also plays a role in the selection of Projects of Common and Mutual Interest, as candidate projects must be included in the latest EU TYNDP and assessed using its methodologies. This makes alignment between national and EU-wide planning particularly important.

Following its assessment, ACER recommends ways to improve consistency between the two levels of planning, helping coordinate network development across borders and supporting national investments that reflect wider European needs.

What are ACER’s key findings? 

ACER finds that alignment between national and EU-wide planning varies across Member States and sectors. While gas network planning is well established, planning for hydrogen is still emerging.

Three main issues limit closer alignment:

• incomplete institutional frameworks for hydrogen network planning;

• different levels of transparency and approaches to scenarios, infrastructure needs assessments and the inclusion and presentation of network projects; and

• uneven regulatory oversight.

At the same time, ACER identifies progress in several areas:

• Gas transmission networks are adapting to accommodate biomethane, while hydrogen injection into gas networks is permitted more widely.

• Network planning increasingly accounts for the decommissioning and repurposing of existing infrastructure. 

• Market consultations are used more often to inform hydrogen planning.

What does ACER recommend? 

• Strengthen the institutional framework for national plans, adopting a biennial planning cycle aligned with the EU TYNDP process, and ensuring effective regulatory oversight of NDPs, including their approval and amendment.

• Improve transparency on planning methodologies, regulatory assessments and important project information (e.g. costs), and strengthen stakeholder and market consultation, particularly on future hydrogen demand.

• Enhance cross-border and cross-sectoral coordination, improving cooperation and data exchange between system operators and better aligning national and EU-level planning scenarios.

• Better integrate decarbonisation measures, ensuring that NDPs reflect the most recent changes in the gas and hydrogen sectors, including infrastructure decommissioning, the repurposing of gas infrastructure for hydrogen and biomethane injection projects.

What are the next steps?

ACER invites Member States and system operators to consider its recommendations to make network planning more consistent and transparent.

The next ACER Opinion will be published in 2028.

On 18 December 2025, ACER received two proposals from all electricity transmission system operators (TSOs) to amend the implementation frameworks for PICASSO and MARI, the EU platforms for exchanging balancing energy from frequency restoration reserves.

With its Decisions 12/2026 and 13/2026, ACER approved both proposals.

What are the implementation frameworks for balancing platforms?

Established under the Electricity Balancing (EB) Regulation, the implementation frameworks harmonise how balancing service providers (BSPs) participate in electricity balancing markets across EU Member States.

These markets allow TSOs to manage unexpected differences between electricity supply and demand. PICASSO coordinates cross-border exchanges of automatically activated balancing energy (e.g. in case of sudden need), while MARI coordinates manually activated balancing energy. Together, they enable TSOs to access balancing resources across borders and maintain system stability.

What did the TSOs propose?

The TSOs proposed to further harmonise the BSP prequalification process, which ensures that power generation or demand units meet the technical and operational requirements to participate in the market and provide balancing services. 

The proposals also introduce a common process for amending the implementation frameworks of PICASSO and MARI to further harmonise the terms and conditions for BSPs.

What did ACER decide? 

ACER approved the proposals, while introducing some amendments:

• A structured harmonisation process. Every two years, TSOs will run stakeholder surveys to identify areas where the terms and conditions for BSPs still need to be aligned across countries. TSOs will then develop a common proposal for further harmonisation and publicly consult on it.
• More harmonised prequalification requirements. ACER introduced additional requirements for switching, re-prequalification, termination of prequalification and data exchange. Given the limited experience with harmonised prequalification, some requirements will continue to be set at national level, with further harmonisation expected as TSOs gain more experience.
• More prequalification options. ACER introduced three prequalification options: activation testing, ex-post verification and a fast-track process. Compared with activation testing, the other two offer faster and easier market access, as balancing services are monitored during operation instead of tested upfront. TSOs can choose any or all three options, subject to approval by their national regulatory authority.
• Easier access for smaller market participants. ACER simplified the prequalification process for smaller participants to help ensure a level playing field. As existing processes were designed around large conventional generators, ACER adapted them to make it easier for all participants that can provide secure and reliable balancing services to enter the market and improve liquidity.

What are the next steps? 

TSOs have six months to submit a proposal to their national regulatory authority to align national terms and conditions with the new requirements. Once approved, TSOs will have 24 months to implement the harmonised prequalification process.

Today, ACER releases its report on the Irish gas transmission tariffs directed at the Commission for Regulation of Utilities (CRU), Ireland’s national regulatory authority (NRA).

The report assesses whether the proposed reference price methodology (RPM) complies with the requirements of the EU Network Code on Harmonised Transmission Tariff Structures (NC TAR). 

What is the proposed tariff methodology?

The Irish NRA proposes to:

• Apply a forward-looking matrix methodology based on marginal expansion costs, allocated between entry and exit points. Under this approach, differences between tariffs at network points would reflect the expected unit cost of expanding the pipeline, rather than historical costs.

• Apply the same tariff to all exit points serving domestic consumption and a single tariff to all future renewable gas production points, regardless of their location.

• Set rules on tariff discounts for any future storage and LNG facilities.

• Continue recovering allowed revenues for transmission services through a combination of capacity- and commodity-based tariffs. Capacity tariffs are charged for contracted network capacity, while commodity tariffs are based on transported gas volumes and recover the related costs.

• Treat the Corrib Linkline (the pipeline connecting the Corrib offshore gas field to the main ring of the Irish gas network) separately from the transmission service, recovering its costs through a separate tariff.

What are ACER’s key findings? 

After analysing the consultation document, ACER concludes that: 

• The proposed methodology meets the EU requirements on cost-reflectivity, transparency, avoidance of cross-subsidisation, non-discrimination, volume risk and prevention of cross-border trade distortions.

• The criteria for setting the flow-based charge are also met.

• The criteria for setting non-transmission tariffs are not fully met, as the Corrib Linkline is treated similarly to a non-transmission service but not formally classified as such.

• The capacity forecasts used in the methodology are based on Ireland's Network Development Plan for 2024, which may not fully capture more recent demand shifts.

What does ACER recommend? 

ACER recommends that the Irish regulator, when adopting its final decision:

• Improve the description of the revenue and tariff structure of the Corrib Linkline and formally classify its use as a non-transmission service.

• Update capacity forecasts using more recent estimates and, if these show cross-system flows, reassess the methodology against the relevant NC TAR principles.

ACER also recommends that, as part of its upcoming review of the tariff methodology, the Irish regulator assess whether a methodology based on forward-looking marginal expansion costs remains appropriate in the context of the energy transition and declining gas demand.

Next steps

The Irish NRA has until 16 December 2026 to adopt a motivated decision on the reference price methodology.

See all ACER reports on national tariff consultation documents.