This Thursday, the Círculo Ecuestre has held the colloquium Electricity market, price crisis and climate change: a possible equation?, where the benefits of the internal energy market have been addressed as a key tool for the reform of the electricity market in the European Comission. The event was attended by Christopher Jones, former director of energy of the European Commission, Antonio Morales, energy partner of Baker Mckenzie and Carlos Padrós, professor of Administrative Law at the UAB.

Enrique Lacalle, vice president of the Círculo Ecuestre, has been in charge of welcoming the act and Antonio Delgado, president of the institution, has carried out the closure. The speakers have held a dialogue moderated by Leandro Lamor, journalist and EFE delegate in Catalonia.

Coinciding with the recent proposal to reform the electricity market of the European Commission, which rejects many of the approaches made by the Spanish Government, the experts have endorsed the position of Brussels and indicated their concern regarding the Spanish initiative, which focuses its approach on applying an interventionist model that supposes the rupture of the market unity that Europe has been building for the last 30 years. The proposal for a single buyer model with an interventionist regime that proposes a mandatory regulated price for existing facilities supposes, de facto, having nationalized markets again, which would make the European Union go backwards in its integration process and would mean a loss of competitiveness for the whole of Europe.

An element questioned in the colloquium has been the intention of Spain to question the effectiveness of European interconnections. Faced with this position, the experts have stressed that the interconnected European energy network is vital to achieving security of supply in the whole of Europe. Likewise, the interconnections have achieved greater competitiveness on the part of the agents present in the market and it is easier for the European Union to achieve the objectives of decarbonization and energy transition that must culminate in 2050 with climate neutrality.

The debate has also focused on the degree of imbalance that the emergency measures adopted by the member states have entailed for the proper functioning of the European energy market. These exceptional decisions have meant, according to experts, that States turn their backs on established climate commitments and have meant reaching record numbers of subsidies for fossil fuels, as well as an increase in polluting emissions.

The increase in subsidies granted by the States to non-renewable energies, as well as other decisions of the same type authorized by the European Commission such as the cap on gas, clash head-on with the agreement reached during COP26, where the States agreed to gradually eliminate the inefficient subsidies for fossil fuels. This situation has caused the countries of the European Union to allocate in 2022 the record figure of 350,000 million dollars in subsidies for polluting energies, and, as a consequence of the increased operation of gas and coal plants, emissions from the electricity sector they increased by 6% in the third quarter of 2022 compared to the same period of the previous year.

The European Commission is committed to preserving the internal energy market

In contrast to the Spanish reform proposal sent to Brussels, the speakers have positively assessed the design of the electricity market proposed by the European Commission. For them, the proposal offers an evolution with respect to the current design, giving greater prominence to new agents present in the system, but without ending the existing model or breaking the market unit.

In this sense, the design proposed from Europe emphasizes the preservation of the internal market as a fundamental element that promotes the competitiveness of the European Union and allows the continent to face new challenges in a coordinated manner, in addition to any other option that breaks with the market. interior would have implied a paralysis in renewable energies, necessary for the energy transition to which the European Union has committed.

Another fundamental element of the reform proposed by the European Commission is that it advocates that the way out of the energy crisis be through clean energy. During the

In the colloquium, emphasis was placed on the fact that the electrification of the system is the only way to end Russia's energy dependence, so the acceleration of the energy transition will not only increase the internal production of clean energy, but will also develop industrial advantages in all economic sectors.

The participants coincided in recalling that Europe is one of the sustainable leaders thanks to the creation of a common market and framework that has allowed for a favorable investment environment, logical and continuous regulations over time, recognizable legal certainty and monitoring of clear and ambitious climate goals.

The proposal of the European Commission has as a new objective for 2030 that at least 40% of clean technologies are manufactured in the European Union, which would reinforce energy independence and the achievement of community climate objectives.

The development of the European Union and the internal market are closely connected

Although the main objective of the internal energy market has been and is to guarantee a competitive market with a high level of consumer protection and adequate interconnection, experts have highlighted the importance of the single energy market in aspects such as the expansion of the rights of users, the reduction of energy poverty and the development of the countries of the Union during the last 30 years.

As the speakers have highlighted, this unprecedented integration has served to turn the European Union into one of the largest trading blocs in the world and has made it possible - and continues to do so - to cushion the disturbances and crises that affect Europe.

The European Union must continue to work on removing the obstacles that still remain and adapt the market to the continuous progress that is being made. In this sense, the speakers have also highlighted that committing to the completion of the internal market has proven to be key in the face of crises such as the COVID-19 pandemic or the current price crisis, situations that can distort the proper functioning of the current market.