• New joint ACER–ESMA Task Force
• Enhanced market surveillance and enforcement

The EU Agency for the Cooperation of Energy Regulators (ACER) and the European Securities and Markets Authority (ESMA) are strengthening their cooperation to further improve information exchange and avoid potential market abuse in Europe’s spot and derivative markets.

The two EU agencies have a long-established cooperative relationship considering the interlinkages between spot and derivative energy markets. One of the fora where this cooperation takes place is the Energy Trading Enforcement Forum (ETEF) where the energy National Regulatory Authorities (NRAs), the financial National Competent Authorities (NCAs), ESMA and ACER discuss implementation issues concerning market abuse rules and share their experience in relation to their supervisory activity and enforcement actions to ensure consistency across the EU.

New joint ACER–ESMA Task Force

Market manipulation and its effects may occur across borders, between electricity and gas markets and across financial and commodity markets, including in emission allowances. Regulatory oversight of potential market abuse of the trading in energy and financial products falls under two EU regulatory frameworks, namely the EU Regulation on Wholesale Energy Market Integrity and Transparency (REMIT) and the Market Abuse Regulation (MAR).

While leveraging existing cooperation tools, ACER and ESMA are establishing a joint Task Force to reinforce their cooperation and enhance coordination in respect of the exchange of data and knowledge among their staff and respective national authorities.

This enhanced coordination will further support the investigations and enforcement so that the rules are applied with vigour and in a convergent and holistic way in all national jurisdictions.

Enhanced market surveillance and enforcement

In the current energy crisis characterised by high prices and price volatility, vigilance in detecting market manipulation and insider trading is more important than ever to ensure confidence in EU wholesale energy and financial derivatives trading.

NRAs and NCAs have both supervisory and enforcement responsibilities at national level. At EU level, ACER maintains its own market surveillance system whilst both ESMA and ACER have supervisory convergence and coordination responsibility.

The joint ACER–ESMA Task Force will provide a framework for broadening cooperation on the monitoring of energy and energy derivatives markets. ACER and ESMA are also ready to cooperate in additional areas in the future. This could notably be the case in the context of the possible new LNG benchmark currently under consideration by the European Commission, and with an enhanced monitoring of risks in energy markets, helping to preserve financial stability in EU markets.

ACER and ESMA are committed to promoting supervisory oversight of wholesale markets for energy and financial derivatives by supporting NRAs and NCAs in effective enforcement of possible breaches of the rules and in assisting the European Commission in its work.

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The EU Agency for the Cooperation of Energy Regulators (ACER) publishes today its first stand-alone report on the performance of Member States (MSs) regarding security of electricity supply in 2021 (‘Report’). The Report extends the depth and scope of past reporting on the subject in ACER market monitoring reports.

The Report looks into three main areas:

• The implementation of the methodologies to calculate the value of lost load, the cost of new entry and the reliability standard by MSs;

• The short- and long-term adequacy assessments at European and national level; and

• The measures implemented by MSs to address security of electricity supply concerns.

The report does not cover measures deployed as a response to the current crisis.

What are the Report’s key findings?

• MSs gradually implement the ACER’s harmonised methodology to calculate the value of lost load, the cost of new entry and the reliability standard defining the necessary level of security of electricity supply. However, non-uniform approaches in implementation need further attention.

• The short-term and seasonal adequacy assessment framework is largely in place. Only two incidents were identified in 2021 and were tackled by Transmission System Operators (TSOs) in a coordinated manner to avoid possible supply interruptions.

• While ENTSO-E’s pan-European resource adequacy assessment is under development, MSs assess security of supply at a national level. Out of the 14 national assessments conducted in 2021, 7 revealed adequacy concerns in at least one of the next ten years. 

• Cost of additional capacity mechanisms rises to €5 billion in 2021 (+81% from 2020) and is expected to reach €7 billion in 2023, largely directed to conventional power generation. ACER raises attention on potential lock-in effects stemming from long-term contracts and points to incompatibility of such capacity mechanisms’ outcomes with future climate and energy targets.

What are the next steps?

ACER will intensify efforts to monitor the implementation of the adequacy-related methodologies at European and national level and will continue to report on security of supply measures, including those applied as a response to the current energy crisis.

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The EU Agency for the Cooperation of Energy Regulators (ACER) publishes today its first monitoring report on the use of congestion income in 2021 (‘Report’).

According to Regulation (EU) 2019/943, all income generated as a result of the cross-zonal capacity allocation must be used as a priority for either guaranteeing the actual availability of the allocated capacity, or for maintaining or increasing cross-zonal capacities. Only where these objectives are fulfilled, the revenues can be used as income when determining network tariffs. Potential residual revenues shall be placed on an internal account line until they can be spent for the abovementioned purposes.

In addition, National Regulatory Authorities (NRAs) must publish a report and inform ACER detailing:

• the amount of collected revenues;
• the amount placed on a separate account line;
• the amount used as income when determining network tariffs;
• explain how the collected revenues were used in view of fulfilling priority objectives.

What are the Report’s key findings?

In summary, the Report finds that the total available congestion income (CI) in 2021 was €6.9 billion. Out of these, €4.9 billion were collected during 2021 and €2 billion were already saved in separate accounts before 2021.

In 2021, the available CI (€6.9 billion) was used as follows:

• €3.1 billion (45%): used on priority objectives;
• €3.4 billion (49%): saved on internal accounts;
• €342 million (5%): used for tariff reductions;
• €89 million (1%): spent on taxes.

ACER welcomes the fact that, compared to 2020, the amount of CI used for priority objectives or saved for future priority objectives-related use increased for 7% (from 88% to 95%), and that the share of CI used for tariff reduction compared to the available CI was reduced by 7% (from 12% to 5%). These figures show an increasing use of CI to fulfil the priority objectives. Despite that, ACER concludes that the priority objectives cannot be deemed fulfilled for five countries, namely for BG, ES, GR, HU, and SI.

ACER prepared this report in line with its duties to monitor the internal electricity markets, the implementation of Projects of Common Interests (PCIs), the EU Ten-Year Network Development Plan (TYNDP) and in order to avoid the lack of prioritisation of necessary interconnection projects at a national level.

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The EU Agency for the Cooperation of Energy Regulators (ACER) and the Council of European Energy Regulators (CEER) publish today the Energy Retail and Consumer Protection Volume of this year’s Market Monitoring Report (MMR).

What is the Energy Retail and Consumer Protection Volume of the MMR about?

The Energy Retail and Consumer Protection Volume of the Market Monitoring Report offers an overview of retail energy market developments across the European Union during 2021. Given the significance of the current energy crisis in Europe the Volume also includes some recent pricing information for 2022 which has been provided by VaasaETT.

It looks at:

• retail market performance, supplier concentration levels and the availability of gas and electricity offers to consumers;
• the price paid by energy consumers for both gas and electricity across the European Union; and
• the impact of high energy prices on household expenditure. 

It issues a set of recommendations:

• to ensure that measures to assist consumers in response to the energy crisis are targeted at those most in need; 
• to ensure that quality comparison tool websites are available to European energy consumers; and,
• to ensure that National Regulatory Authorities (NRA) check the compliance of energy consumer bills with the common rules for the internal market for electricity (Directive (EU) 2019/944)

Some main findings:

1. Retail energy prices started an upward trend at the end of 2021, these price increases to continue during 2022 and into 2023.
2. Electricity and gas price increases will put a greater number of consumers at risk of energy poverty.
3. Supplier bankruptcies have resulted in less choice in the market for energy consumers.
4. Consumers have demonstrated a preference for fixed price contracts. However, suppliers will struggle to offer such contracts at competitive prices in 2022 and likely into 2023.

Download the 2021 Energy Retail and Consumer Protection Volume.

Register and join a presentation of the Energy Retail and Consumer Protection MMR 2021 at the webinar on Wednesday, 12 October 2022.

Explore the rest of the MMR publications and energy market data in our interactive dashboard.