Within the framework of the International Energy Agency, FSR is hosting the second meeting of the Global Observatory on Peer-to-Peer (P2P), Community Self-Consumption (CSC) and Transactive Energy (TE) Models.

Decarbonisation, decentralisation and digitalisation are reshaping the way electricity is produced, traded and consumed.

New energy models, not even thinkable a decade ago, are emerging around the world. Electricity consumers, for example, may now benefit from the possibility to produce, individually or collectively, the energy they consume and to trade any surplus with their peers. Opportunities like this represent a major change from the old world where consumers were, to a large extent, passive users of the electricity system, either from a physical and a commercial point of view.

Launched in September 2019, the Global Observatory is a three-year collaborative research project under the IEA Users-Centred Energy Systems Technical Collaboration Programme (UsersTCP). It represents a forum for international collaboration to understand the policy, regulatory, social and technological conditions necessary to support the wider deployment of peer-to-peer, community self-consumption and transactive energy models.

The conference will last two days:

On the first day, open to the public, academics, industry practitioners and representatives of the institutions will meet and discuss the definitions of these new energy models and the opportunities and difficulties that they raise. A few concrete cases of P2P, CSC and TE energy models will be presented and will be used to ignite the debate.

During the second day, researchers involved in the Global Observatory will meet again, present the work conducted so far in the various Observatory subtasks and discuss the steps to take in the following six months.

Participation to the first day is open to everybody but subject to registration and seats availability. Participation to the second day is limited to researchers who are part of the Global Observatory.

Join the discussion online using the hashtag #P2PEnergy

The conference is financially supported by the Foreign & Commonwealth Office of the United Kingdom.

This workshop aims to present the main mutual activities of Florence School of Regulation (FSR) and Perusahaan Gas Negara (PGN), and explore areas of further cooperation. In particular, PGN will give an overview of the current developments in the Indonesian gas market, while FSR will present the main activities carried on by FSR Gas and other areas of potential interest.

PGN will be provided with an overview of the recent initiatives in terms of research, training and policy debates, in order to explore and discuss potential cooperation and future partnerships. The findings of the very recent FSR Research Project “Definition of a Roadmap for the Establishment of a Gas Transportation National Dispatching Centre in Indonesia” will be presented. The workshop will conclude with an open discussion on how to consolidate the cooperation between FSR and PGN to address future challenges and to successfully solve them.

The FSR and PGN have been cooperating since 2015, by engaging in research on topics of common interest and exchanging views on how to address specific regulatory and policy issues relating to gas markets.

Participation is by invitation only.

The workshop on variable generation, flexible demand is organised by the Florence School of Regulation in partnership with Menlo Energy Economics.

For decades, utilities have been predicting electricity demand and dispatching generation units to meet it.

The current energy transition and the growing role of intermittent renewable energy sources make such a traditional way of operating the electricity system no more the most efficient nor reliable.

In the future, we will increasingly be predicting variable renewable generation and schedule demand to match it. A more sophisticated involvement of the demand side in system operation will be required.

In liberalised electricity systems, it is the task of firms and markets to identify new ways to elicit the provision of flexibility by network users and end consumers.

Building on the success of its previous edition in February 2019, this workshop will investigate new business models that are emerging in the electricity sector.

Participants from the industry, academics and representatives of public institutions will be able to brainstorm freely and share ideas on where, and how, value can be created in the electricity sector of the 21^st century.

Scientific organisers:

• Jean-Michel Glachant (FSR)
• Nicolò Rossetto (FSR)
• Fereidoon Sioshansi (Menlo Energy Economics)

Join the discussion online using the hashtag #FlexDemand

FSR workshop on Water Regulation: Paving the Road for 2020

In this seminar hosted in Florence, we will work on water investment needs in Europe as well as on water tariff regulation, discussing the 2019 European Water Regulators’ report (WAREG).

We will discuss in-depth the variety of water tariff regulations in Europe and the way to foster water investments where it is needed. We will also address the question of regulation, investments, and social objectives.

The seminar will bring together academics, representatives from EU institutions, representatives from regulatory authorities, lawyers and economic consultants, and members of the industry for the debate.

Welcome address and road map by Stéphane Saussier, FSR and Sorbonne Business School. 

Invited speakers include:

• Andrea Guerrini, ARERA & WAREG
• Antonella Bancalari, London School of Economics
• Ivaylo Kastchiev, Energy and Water Regulatory Commission (EWRC)
• Stéphane Straub, Toulouse School of Economics
• Paola Valbonesi, University of Padova
• Kathleen Dominique, Organisation for Economic Co-operation and Development (OECD)
• Laura Brien, Commission for Regulation of Utilities in Ireland (CRU)
• Giordano Coralullo, Utilitalia

Participation in this workshop is open subject to availability. Priority will be given to FSR Donors and invited guests.

Join the discussion online using the hashtag #FSRWater.

 in cooperation with WAREG

First online debate of the LIFE DICET project

Organised by FSR Climate

Linking Emissions Trading Systems in the Paris Agreement era: prospects, opportunities, challenges

• Speakers: Jos Delbeke (EUI) and Robert Stavins (Harvard)
• Moderator: Simone Borghesi (EUI)

Over the past few years, the number of operating or planned Emissions Trading Systems (ETSs) around the world has been increasing and relevant experience with some already well-established ETSs has been accumulated. This fact and the context laid out by Article 6 of the Paris Agreement suggests that in the near future the international carbon market might be reinvigorated  by new linkages between existing ETSs.

In this online debate, Jos Delbeke and Robert Stavins will discuss the current prospects for ETS linking as well as the opportunities and the challenges for the jurisdictions that do consider linking their ETSs.

Watch the recording

Join the discussion online!

Economics of Electricity: Markets, Competition and Rules

FSR Online talk

• Speakers: Anna Creti (Paris Dauphine) and Fulvio Fontini (University of Padova)
• Moderated by Leonardo Meeus (Florence School of Regulation)

In this online talk, we will discuss with Anna Creti and Fulvio Fontini their new book titled “Economics of Electricity: Markets, Competition and Rules”.

The 45′ event moderated by Leonardo Meeus (FSR) will focus on electricity markets, outlining the economic principles behind the exchange and supply of power to consumers and firms, how markets should be optimally designed to produce and deliver electricity effectively and efficiently and other key issues like decarbonization of the electricity sector.

Join the discussion online!

Watch the recording

• Gas in transition: the future role of gas in the EU and the European Green Deal
• Future Gas Target Model
• Article 101(3) and sustainability
• Could gas infrastructures become stranded assets?
• Sector Coupling
• The future role of Gas TSOs under sector coupling

Open access material

FSR Regulatory Policy Workshop Series 2019-2020

Artificial Prices, Excessive Prices and Manipulative Practices in the Internal Energy Market

The Workshop will explore and compare the different approaches to deal with “high” prices in auction-based energy markets under REMIT and competition law and it will be structured in two sessions:

• Session 1 will spell out and compare the concepts related to “high” prices under REMIT and competition law;
• Session 2 will look at how these concepts apply to auction-based energy trading and the available experience from recent cases.

This workshop is exclusively open to national regulators, representatives from public bodies and associate & major donors of the FSR Energy area.

Background

The integration of the Internal Energy Market, both in the electricity and gas sectors, heavily relies on market prices to provide the signals for the efficient use of and investment in energy infrastructure. Moreover, as electricity cannot be efficiently stored in large quantities, market prices also provide a signal for the generation of electricity. In this respect, correct price signals are essential for generation efficiency (i.e. that the least cost generation is used to serve demand, subject to network constraints).

The importance of correct (and reliable) price signals for the efficient integration of the Internal Energy Market has led to the adoption of Regulation (EU) No 1227/2011 on wholesale energy market integrity and transparency (REMIT). The aim of REMIT is to detect and deter market abuse – in the form of market manipulation, attempted market manipulation and insider trading – in EU wholesale energy markets.

Article 2(2) of REMIT defines market manipulation, inter alia, as “entering into any transaction or issuing any order to trade in wholesale energy products which […] secures or attempts to secure, by a person, or persons acting in collaboration, the price of one or several wholesale energy products at an artificial level, unless the person who entered into the transaction or issued the order to trade establishes that his reasons for doing so are legitimate and that that transaction or order to trade conforms to accepted market practices on the wholesale energy market concerned”. Recital (13) of REMIT explains that “manipulation on wholesale energy markets involves actions undertaken by persons that artificially cause prices to be at a level not justified by market forces of supply and demand, including actual availability of production, storage or transportation capacity, and demand”. Therefore, an artificial price is one which is “not justified by market forces of supply and demand”.

It is worth noting that, under REMIT, artificial prices could be higher or lower than those justified by market forces of demand and supply and that the main aim of REMIT is not as much to protect consumers from high prices, but rather more widely to:

–          “ensure that consumers and other market participants can have confidence […] that prices set on wholesale energy markets reflect a fair and competitive interplay between supply and demand, and that no profits can be drawn from market abuse” (Recital (1) of REMIT);

–          “foster open and fair competition in wholesale energy markets for the benefit of final consumers of energy“ (Recital (2) of REMIT).

In this last respect, although the objectives of REMIT come close to the objectives of EU competition law (i.e. to prevent exclusionary or exploitative practices by dominant undertakings), there are some important differences.  Article 102 of the Treaty on the functioning of the European Union (TFEU) can and has been applied, for instance, to deal with capacity withholding by dominant firms, but under certain well-defined conditions.  This is in contrast to the application of REMIT as the relevant provisions also apply to all market participants – i.e., non-dominant undertakings. Whereas REMIT’s focus is on ‘integrity and transparency’, Art 102 TFEU has a narrower economic focus on harm to the competitive process.  In fact, the narrower scope of competition law and therefore the need to complement it to ensure integrity and transparency in energy trading was recognised by the EU legislator adopting REMIT: “Behaviour which undermines the integrity of the energy market is currently not clearly prohibited on some of the most important energy markets. In order to protect final consumers and guarantee affordable energy prices for European citizens, it is essential to prohibit such behaviour” (Recital (2) of REMIT).

Indeed the theory of harm that informs REMIT appears to be of a different order than that which underpins EU competition law, albeit this is not fully articulated or developed in academic literature.

Therefore, in this Workshop, we aim at comparing how REMIT and competition law looks at “high” prices, in particular in the context of auction-based energy markets (such as the electricity day-ahead market, but also capacity markets). Under the assumption of perfect competition, the optimal strategy for market participants is to offer into the market at marginal/opportunity costs. Following this strategy, fixed costs would be recovered through the so-called “infra-marginal rent”, i.e. the difference between the market equilibrium price (defined by the offered price/marginal cost of the last accepted offer) and the marginal cost as reflected in the offered price. In reality, the conditions for perfect competition are rarely met, and market participants might be tempted, in certain situations (e.g. when the margin between demand and available capacity tightens up, possibly due to network congestion), to offer above their marginal/opportunity costs to increase their revenues (towards covering fixed costs or increasing profits). The question, therefore, arises of whether the recovery of fixed costs can be considered as part of the “fair and competitive interplay between supply and demand”.

Recovery of fixed costs probably sets a more stringent threshold than the concept of excessive prices in competition law, where the threshold for intervention has been set relatively high, and it has often been typical of the cases that the costs used as a point of comparison or benchmark for the alleged pricing practices at issue have been open to interpretation.   Competition authorities are generally reluctant to take on the role of price regulators, and the case law/decision-making practice on ‘excessive prices’ is not well developed.

The recent joint guidance published by the German competition authority (BKartA) and network regulator (BNetzA) in September 2019 considers that the non-use of actually available generation which could have been sold at a price above the respective short-term marginal cost could be an indication of capacity withholding.  This approach is not without controversy.  Furthermore the experience from the Danish Elsam cases indicates that competition and regulatory authorities have struggled to devise a satisfactory cost benchmark that will withstand judicial scrutiny.

This seminar, set up in collaboration with Sir Alan Dashwood and Dechert LLP, will focus on investment protections after Brexit. Bringing together leading authorities in EU law and arbitration practitioners, we will address the impact of Brexit on intra-EU disputes and the investment protection regime governing EU investments in the UK and UK investments abroad. Among the issues, we will debate:

• The major economic and political risks to investors in the UK and to UK investors abroad.
• Potential recourses for investors against the UK based on possible regulatory changes implemented as a result of Brexit.
• The UK’s relationship with the EU after Brexit
• The future of investment protection in the EU
• Organising investor protection in the UK and for UK investors abroad in the post-exit world.

Confirmed speakers include:

• Former EU Court of Justice Judge Alan Rosas
• Former EU Commission Director-General Sir Jonathan Faull
• Sir Alan Dashwood QC – former Head of the EU Council Legal Service, barrister at Henderson Chambers
• Sir David Edward KCMG PC QC – former judge, EU Court of Justice, international arbitrator and mediator at Blackstone Chambers
• Arif Ali – Head of International Arbitration, Dechert
• Leigh Hancher – Director, Energy Union Law, Florence School of Regulation, European University Institute
• Michelle Bradfield – Partner, International Arbitration, Dechert
• Dániel Dózsa – Counsel, International Arbitration, Dechert

17.00 – 17.15: Registration

17.15 – 19.30: Seminar

19.30 – 20.30: Cocktail Reception

Please note, this is an open workshop and there is no fee to participate. However, given the limited availability of places, priority will be given to the FSR Energy Union Law Donors and invited guests.

This event will answer to the question ‘Why LNG is the fuel of choice for a sustainable energy system?’. It will also mark the presentation of an inclusive and global LNG industry report. The debate will convey around the report lines and focus on the role of LNG in the energy transition, the use of LNG in shipping and heavy-duty transportation.

One of the many challenges of the 21^st century is to provide access to all citizens to reliable and affordable energy and, at the same time, to reduce the impact on climate change and improve air quality. Over 900 million people currently are living today without access to secure electricity and 2.7 billion lack access to clean cooking, according to the International Energy Agency (IEA).

The industries are now looking for sustainable, cost-efficient and environmentally friendly solutions. Various international voices such as G20 and the European Commission President-elected Ursula von der Leyen endorsed the role of natural gas, in both gaseous and liquified form. The IEA expects natural gas to represent around 40% of total energy demand growth over the next two decades with a crucial role in powering electricity generation and in sectors more difficult to electrify.

Today’s global energy consumption is responsible for two thirds of greenhouse gas (GHG) emissions and significantly impacts air quality, especially in densely populated areas. Natural gas can contribute to a sustainable energy future by helping to reduce air pollution across all sectors: power generation, industry, domestic heating and use and transportation. LNG is a fundamental asset that helps meeting EU’s long-term decarbonisation targets and Paris commitment.

An LNG Protocol event supported by FSR

The Policy Advisory Council discusses the most topical regulatory and policy issues and debates the relevance and robustness of the latest FSR research findings.

The meeting gathers renowned academics, experts from the FSR-Energy Major Donors, the European Commission, the Agency for the Cooperation of Energy Regulators (ACER) and National Regulatory Authorities.

The event is structured as follows:

Day 1

• Session 1: EV Charging policies and business models – Lessons Learnt and vision of the future
• Session 2: Integrating EVs into the network as load and utilising V2X capabilities

Day 2

• Session 1: Gas Terminology (sector coupling project)
• Session 2: Opal Ruling: Solidarity and access to  gas infrastructure

Please note this is a closed event and participation is by invitation only.

FSR Online Talk with Pradyumna Bhagwat and Samson Hadush

Dive in deeper in our new online course: Electric Vehicles: a power sector perspective!

This specialised 5-week online course is specifically designed for professionals who wish to address the power sector challenges posed by the ever-growing number of EVs on a global scale. Learn more and save your seat!

About the Online Event:

The rapid growth in EV uptake required to reach India’s policy targets will have to address two major challenges. The first challenge is ensuring the deployment of the charging infrastructure required to serve the needs of the ever-growing number of EVs. This raises two questions:

1. What policies and regulatory frameworks are required to enable the efficient deployment of charging infrastructure?
2. What business models can reach sufficient coverage of charging infrastructure that meets the needs of the EV user?

The second challenge is the integration of the EVs into the power system securely and efficiently. This raises two questions:

1. How can the potential impacts of the additional EV load in the power system be managed?
2. How can the flexibility potential of Vehicle-to-X (V2X) be unlocked?

Join Pradyumna Bhagwat and Samson Hadush to explore the toolbox consisting of solution choices and recommendations to tackle these issues.

More from our knowledge hub:

In our February Topic of the Month series, FSR Global shared an overview of the current status Electric Vehicle’s (EV) sharing the Indian Perspective, insights from the Spanish EV observatory, a regulatory perspective on how the LAC power sector is gearing up for the EV revolution and early experiences with V2X (vehicle-to-everything) in practice.

You can also download a copy of our detailed report or policy brief “Charging up India’s electric vehicles: infrastructure deployment and power system integration” on the rapid growth in EV uptake in India and the challenges the country will have to address to meet its policy targets.