Long-term energy supply contracts in the EU: where competition policy meets market design

Peter Alexiadis

Chapter 2 in Research Handbook on EU Competition Law and the Energy Transition, 2024, pp 14-38 from Edward Elgar Publishing

Abstract: The disciplines of sector-specific regulation and competition law have long sought to accommodate one another in terms of their respective approaches to long-term supply arrangements in the energy sector. That process has taken into account the long-term importance of ensuring the security of supply both from the perspectives of investor and of customer while, conversely, ensuring that new entrants not be foreclosed from access to customers in the short term. Depending on the particular cycle of investment and regulation taking place, regulators have sought to reconcile these two contradictory approaches in a range of cases involving Article 102 TFEU, merger reviews and State aids policy. As of late 2023, political agreement was reached on the milestone EU Energy Market Design Proposal, changing the balance between how regulation and competition policy interact in their approach to long-term energy supply contracts. In doing so, upstream energy producers and investors are being afforded greater flexibility in the financial risk-taking, leaving competition policy with a residual role to play, primarily in more downstream energy markets. The chapter explores the key elements of the Market Design Proposal and the principles guiding competition policy in this area.

Keywords: Law - Academic (search for similar items in EconPapers)
Date: 2024
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