‘Market reforms a prerequisite for CAT mechanisms’

The European Commission has released a finalized report concerning CAT mechanisms, noting that market reforms are a prerequisite before they are adopted.

Many EU member states are lagging behind in the requirements set by the EU framework, the report noted.

It also stresses that member states often fail to fully define the matters they intend to resolve through mechanisms before adopting them.

“The capacity availability mechanisms need to respond to the demands set by the market and be open to all technologies. They must not indirectly offer support to a specific technology, such as fossil fuels, or lead to particularly high prices for consumers,” noted Margrethe Vestager, the European Commissioner for Competition. “The report will help both the European Commission and EU member states introduce more accurately designed mechanisms, only if there is a real need for them. Even in the event that CAT mechanisms are well designed, they cannot replace the essential need for electricity market reforms.”