EU electricity market reform – what impact could it have on consumers?

On 14 March 2023, the Commission published a proposal to reform the EU electricity market, covering both retail and wholesale electricity markets. The aim of these reforms is to ensure that suppliers can cope with sharp increases in energy prices, make use of cheaper energy supply contracts, and guarantee favourable conditions for consumers who are currently not benefiting from the liberalised market. This article summarises the key points of the proposed reform, which, if approved, would affect the options available to customers.  

Governments’ power to set price caps would be subject to two conditions

One of the key issues last year was the introduction of price caps on energy markets. The proposal therefore addresses the trade-offs involved in protecting consumers during sharp increases in energy prices. It includes the option for Member States to set price caps below retailers’ costs during a regional or EU-wide electricity price crisis, in order to protect households and small and medium-sized enterprises.