Advancing the integration of Europe’s energy markets

The European Commission and Baltic Sea Region countries have signed a Memorandum of Understanding (MoU) modernising and strengthening the Baltic Energy Market Interconnection Plan. 12 European countries have also signed a declaration for regional cooperation on security of electricity supply within the European internal market. This was followed by the signature of a political declaration of the Pentalateral Energy Forum.

Regional cooperation with neighbouring countries within a common EU framework is a key building block for the Energy Union. This is paramount for ensuring uninterrupted energy supplies and affordable prices for consumers. Regional cooperation will help achieve EU wide market integration and further contribute to unlocking the full potential of renewables in the energy system.

Commissioner for Climate Action and Energy Miguel Arias Cañete said: "These agreements are a first milestone. They give the political backing to a stronger energy cooperation in Europe. The signatory countries are determined to enhance security of supply through further market integration. This is one of the main building blocks of the Energy Union, which is one of the key priorities of the Juncker Commission. Today the Member States begin synchronising their efforts and working together towards cheaper and more effective solutions. Where there is a will there is a way. Today Member States are showing their will."

The political declaration for regional cooperation on security of electricity supply in the framework of the European internal market was signed by Germany, Denmark, Poland, Czech Republic, Austria, France, Luxembourg, Belgium, the Netherlands, Sweden as well as the neighbouring countries Switzerland and Norway. It sets political commitments to better coordinate national energy policies, including on security of supply, a more efficient use of existing electricity networks and increasing the integration of renewable energies to the national markets. The declaration shows significant convergence on key challenges and opportunities of further electricity market integration between regional groups of Member States. To address these challenges and to use the potential of an integrated market, the Commission is working on proposals for a revised electricity market design to be released in 2016. A consultative communication on electricity market design is planned for this summer.

The second political declaration of the Pentalateral Energy Forum was signed by Austria, Belgium, France, Germany, Luxembourg and the Netherlands. The forum counts for more than one third of EU population and covers more than 40% of the electricity generation in the EU. It aims to foster open and transparent regional dialogue in order to increase security of supply, further market integration and pursue greater market flexibility. In particular, it will elaborate a common methodology for assessing the security of supply risks at regional level and to create right conditions for cross border electricity trade.

The Memorandum of Understanding on the reinforced Baltic Energy Market Interconnection Plan (BEMIP) was signed by Estonia, Finland, Germany, Latvia, Lithuania, Poland, Sweden and Norway (Denmark will sign at a later stage). Seeking to end the energy isolation of the Baltic Sea Region and to integrate it fully into the EU energy markets the countries extend the scope of the BEMIP initiative by adding to the already existing areas of cooperation (internal energy market, interconnections and power generation) new areas, such as energy efficiency, renewables and security of supply. The memorandum also foresees more effective cooperation with a view making the Baltic States form part of the continental European synchronous area.

Adapted from press release by Rosalie Starling

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