In recent years the EU's energy sector has seen significant technological change – households and businesses are increasingly able to fine-tune their energy use, electric vehicles are coming on to the market, and the wide-spread uptake of renewable energy is a reality across the continent.
"Many developments have come to the fore that a few years ago seemed only a remote possibility," Miguel Arias Cañete, Commissioner for Climate Action and Energy, told the Council of European Energy Regulators' (CEER) Annual Conference on 29 January in Brussels.
These developments have put Europe on the path towards a more reliable and sustainable use of energy, but they also require European energy markets to become more flexible in order to adapt to these changes, Arias Cañete said.
Demand side flexibility – whereby consumers can adjust their electricity consumption according to price signals – can significantly reduce energy costs. To unlock this potential, consumers should be able to benefit from price changes on wholesale markets, they need to have access to clear, transparent and secure information and reliable online price comparison tools.
Meanwhile, smart grids and smart metres will increase demand side flexibility, market regulators should oversee the market in a transparent way and grid tariffs should be fair.
The design of the energy markets should also be flexible – which means requiring markets to trade closer to real-time, allowing renewables in particular to become more integrated and European rules should enable better management of energy supply and demand across national borders.
“In order to keep the lights on, system operators will need to cooperate more in the future and explore areas where cooperation would increase security of supply,” Arias Cañete said.
The benefits of increased flexibility in the system and cooperation will be more affordable and reliable energy provision for Europe's citizens, he told the CEER delegates.