However, creating the right political framework is as important as ever. European nations would have to move even closer together and align their energy policies. An integration project like this would require a certain degree of diplomacy and intuition.
Economic agents shared these sentiments. Lex Hartman from TenneT TSO’s Board of Directors insisted that the energy revolution calls for a combined European effort, adding that going it alone would prove fruitless. “We can’t all export energy at the same time.” He explained that if one country generates more energy, the other would have to curtail its production accordingly. Wenzel concurred, highlighting the importance of agreeing on a pan-European regulation within the coming years. Such a ruling would have to outline expectations for each participating country.
A New Kind of EU
Dr. Oliver Koch of the European Commission illustrated the European energy market’s new design using the EU’s “winter package” as an example. Koch also emphasized the difficulty of creating a unified market, or “Energy Union”. Furthermore, he explained the need to smooth the path towards a digital economy.
Indeed, the digital age presents several challenges. Operators used to be able to plan with greater reliability, but the energy market today is much more volatile than it was. In the new era of energy, it isn’t always clear when and where it is being generated. “Energy is always somewhere else.” Yet the network has to be stable everywhere. Supply and demand – and not production – should determine where energy goes. This is something regulators have to make sure of.
There are three main solutions:
- Clear rules: The EU requires regulations for today’s volatile markets.
- Market forces in place of subsidies: State intervention must be cut back.
- Pan-European cooperation: Countries must work together regardless of borders.
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offers a concise and informative overview of the topic.