European trade bodies call for accelerated renewables rollout

The heads of five major energy trade bodies in Europe have written to the European Union and member states urging them not to change the current power price setting mechanism in light of the continent’s energy crisis and instead pursue greater renewables rollout.

They have called on the trade bloc and its member states to shift away from fossil fuels, invest in clean energy alternatives, accelerate energy savings and unlock demand response, while avoiding changes to the current electricity price setting mechanism.

“Short-term interventionist measures such as wholesale or retail price caps should be avoided,” said the letter. “Such measures impair the ability of the energy market to deliver an efficient and secure supply/demand balance in the spot market, increasing the cost of the energy transition.”

The letter said European electricity markets have “proven highly effective in ensuring a secure electricity supply to consumers, while providing incentives for clean investments” during the region’s energy crisis, adding that forward markets have “sent a powerful signal for investments in renewable energy, energy storage and consumer-driven solutions, including by way of Power Purchase Agreements (PPA) and long-term hedging.”