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Europe can integrate a larger share of renewables into the power system provided policymakers take significant steps to overhaul electricity markets, a new report finds. The Market4RES study – an EU-funded project – claims that more flexible electricity markets would significantly reduce the cost of integrating variable renewables in the energy system.

The specific elements of flexibility the study recommends are: more cross-border trading of electricity over a broader geographical area; a level playing field between renewables and conventional generation in accessing electricity markets including balancing; transparent pricing of electricity; increased use of dynamic pricing to boost demand response; and better design of support schemes for renewables. The study also covers priority dispatch and recognises the case for phasing it out over time, specifically for new renewable installations once there is a level playing in the power system. The EU will be addressing these issues in the new legislative proposals for electricity market design, which it is expected to table at the end of November.

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