Fri, 18 November, 2022
The GeoSmart project consortium have produced a factsheet offering insights into the current energy crisis.
The factsheet, ‘Electricity Market Design in a Time of Crisis: The Case for Geothermal and Renewable Flexibility Resources,’ which you can see in full below, details how some European Member States have been seeking a suspension or alteration of the electricity market rules.
Nations including France, Greece, Italy and Spain have expressed concerns over the functioning of the electricity market, with the situation also having been exacerbated by Russia’s invasion of Ukraine.
Expectations are that energy prices will remain high for a few years yet, which has led to solutions being discussed including a scaling up of renewable power and heat generation technologies, improved electricity-saving measures, and pricing that shows the value of each energy source.
The GeoSmart consortium factsheet offers an insight into matters including the use of price caps and windfall profits, the decoupling of the gas and electricity markets, and dividing remuneration of the electricity market between zero carbon and other sources – particularly fossil fuels.
Along with suggestions to place natural gas on the margins of the electricity market, the factsheet also details a series of proposals from the European Commission. These include a coordinated reduction in demand, a temporary revenue cap on lower cost technologies – with extra revenue going back to help reduce bills for energy consumers, a solidarity tax on fossil fuel companies, and an expansion or the energy process toolbox to allow below cost regulated electricity prices for the first time and expand regulated prices to also cover small and medium-sized enterprises.
There is a growing belief that fossil gas must be replaced as the price-setting fuel through the upscaling and accelerated deployment of flexible renewable energy such as geothermal and the factsheet goes on to outline a series of considerations to allow the full exploitation of geothermal energy.
You can read the informative GeoSmart consortium factsheet in full, below: GeoSmart electricity market reform factsheet - pdf - 250kb
The GeoSmart project has received funding from the European Union's Horizon 2020 research and innovation programme grant agreement 818576