The core objective of this paper is to analyse the relevance of cross-border transmission lines for competition and the achievement of a single energy market, with particular focus on the electricity sector. It aims to discuss future options for enhancing competition and achieving a real European energy market.
A common energy market even closer Union characterized by the abolition of any barriers to the four fundamental freedoms. A main barrier for creating an integrated energy market is the lack of electricity interconnections and pipelines between different Member States, between neighbouring regions and regional markets. Insufficient investment and the lack of coordination are the challenge on the path towards interconnected energy markets. Consequently, the security of energy supply of certain Member States is redoubtable.
Moreover, the existence of historical monopolies and oligopolies on the majority of national energy market and the presence of vertically integrated companies are further burdens for both market integration and competition. Indeed, competition in the energy markets is stagnating. To intensify cross-border competition, the EU advocates the extensions of cross-border transmission lines and the development of new infrastructures. Although interconnections enhance competition and are a condition sine qua non for a further energetic integration, they do not always increase energy efficiency.
Table of Contents
List of Graphs
List of Figures
1. Introduction
2 Towards a Single Energy Market
2.1 The First Energy Package and the Florence Forum
2.2. The Liberalization of the Gas Sector and the Madrid Forum
2.3. Europeanization of the Energy Markets
2.4. Regional Energy Markets-a Main Step Forwards
2.5. Achieving a Single Energy Market-the Third Liberalization Package
3. Regulation of Cross-Border Energy Exchanges
3.1. Regulation of Tarifs in Cross-Border Electricity Trade
3.2. Congestion Management
3.2.1. Limitation of Transmission Capacity
3.2.1.1 .Long-Term Capacity Reservation Agreements
3.2.1.2. Public Services
4. Derogations and Exemptions of Restrictive Practices
4.1. Small Isolated Systems in the Electricity Sector
4.2.Isolated Gas Markets
5. Efficiency and Energy Cross-Border Trade
5.1. The Key Importance of Interconnectors
5.2. The Interplay between Efficiency and Market Integration-the Swedish Interconnectors Case
5.3.Efficiency and Cross-Border Trade of Gas
6. How to Improve Energy Cross-Border Trade?
6.1. Investments and Subsidies
6.2. An Energy Infrastructure Package
7. Conclusion
ANNEX II
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