Seminar 1 October: Capacity Mechanisms, the Energy Turnaround and State Aid Law

On 1 October, Oxera and Bird & Bird will be organising an afternoon seminar in Düsseldorf on “Capacity Mechanisms in the Energy Turnaround – Risks for Market Participants? The seminar will cover important current energy state aid law questions, and will be held mainly in German. It is free, but places are  limited. Please send me an e-mail if you are interested.

1. Background

The relevance of European state aid law has dramatically increased last year, not only because of the guidelines on state aid for environmental protection and energy 2014-2020. The ministerial draft for the new Electricity Market Act (Strommarktgesetz) has been out for a while. It decided against a capacity market, and instead opted for an “electricity market 2.0” (“Strommarkt 2.0”). However, the government does not fully trust the market, as capacity reserves outside of the electricity markets shall provide a safety net for the electricity market 2.0. Next to a “capacity segment” potentially coming for all types of generations units, regardless of power source, a new “climate segment” for power from lignite shall reduces CO2 emissions.

The Federal Network Agency has carried out a consultation on redispatch remuneration. As the Higher Regional Court of Düsseldorf had followed the line of argument of the Federal Cartel Office on the illegality of the Irsching agreements (Art. 101 TFEU).

In addition, on 29 April 2015 the European Commission had launched its first sector inquiry under EU state aid rules into national capacity mechanisms, looking into potential distortions of competition or trade in the EU single market and devise appropriate legislative iniatives for an electricity market design in line with the EU’s Energy Union Strategy.

All this raises many legal and economic questions on the state aid law compliance of capacity reserves, grid reserves, reserve power, and CO2 reduction measures. On the other hand, London seems to so far have been quite successful in getting its capacity market and Hinkley Point cleared by the Commission.

The seminar will look at recent German developments against the background of experience in the UK. We will discuss current German plans, their state aid law relevance, as well as potentially successful approaches to resolve the issues. The event is addressed to representative from the energy industry and authorities.

2. Programme

Please note that the event will be held mainly in German, without translation into English (even if the text below is in English).

14:30 – 14:40 – Welcome and Introduction
Dr. Matthias Lang, Partner Bird and Bird LLP

Part 1 – 14:40 – 15:40

Risks of Capacity Instruments in the German Electricity Market – Legal and Economic Background and International Experience

  • Wie schafft man ein beihilferechtskonformes, adäquaten Erzeugungsregime – Beispiel Kapazitätsmarkt Großbritannien / Designing a state aid compliant adequacy regime – the example of the GB capacity market
    Peter Willis, Partner Bird & Bird LLP
  • Economic criteria in the European Commission’s decision on Hinkley Point C
    Jostein Kristensen, Partner Oxera

15:40 – 16:10
Coffee Break

Part 2 – 16:10 – 17:25
An Electricity Market for the Energy Turnaround – What shall we do?
Panel discussions with brief introductory statements

  • Was verbirgt sich hinter den Kapazitätsmechanismen im Strommarkt 2.0 und ihren Vergütungsmechanismen? / What is behind the capacity mechanisms in the electricity market 2.0?
    Barbie Haller, Referatsleiterin Wirtschaftliche Grundsatzfragen der Energieregulierung, Bundesnetzagentur
  • Versorgungssicherheit im EOM 2.0 – Kann das Beihilferecht ‎einen konstruktiven Beitrag leisten und wo liegt die Grenze? / Security of supply in an EOM 2.0 – Can state aid law provide a constructive contribution and where are the limits?
    Dr. Paula Hahn, Abteilungsleiterin Recht, BDEW Bundesverband der Energie- und Wasserwirtschaft e.V.
  • Binnenmarkt und angemessenes Marktdesign für Kapazität und Arbeit / Internal Market and adequate market design for capacity and generation
    Dr. George Milojcic, Hauptgeschäftsführer des Bundesverbands Braunkohle DEBRIV

17:25 Closing Remarks
Dr. Michael Kraus, Oxera

3. Attending

The seminar is free, but places are limited. If you would like to attend, please send me an e-mail.

Source: Bird & Bird

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