Council debates regulation on energy market integrity and transparency

At its meeting held in Brussels on 28 February, the Energy Council was was briefed on the state of play of discussions on the draft regulation on energy market integrity and transparency aimed at setting up a framework for monitoring wholesale energy markets in order to detect market abuse and manipulation. The Commission considers that, although market abuse and manipulation relating to financial instruments in general are already covered by other legal provisions, the particular nature of the market for gas and electricity required a separate instrument.

The Hungarian Presidency intends to progress as much as possible with the examination of the proposal for a Regulation on energy market integrity and transparency, in light of the European Council conclusions of 4 February 2011, which invited the Council and  the European Parliament to work towards the early adoption of such proposal.

Why an EU-level energy monitoring framework?

As the EU internal energy market for electricity and gas is becoming more and more liberalised and interconnected, the potential for its abuse and manipulation is also growing. The proposed regulation sets up a framework for monitoring wholesale energy markets in order to detect market abuse and manipulation, thereby ensuring the integrity and transparency of those markets. The central element of this framework is the establishment of a market monitoring function at European level, a task which should be carried out by the Agency for the Cooperation of Energy Regulators.

The main elements of the draft regulation are the following the definitions and legal prohibition of trading on the basis of inside information and market manipulation as well as market monitoring and data collection. It also involves investigation and enforcement and provisions for adopting delegated acts.

During this meeting, the Council also adopted conclusions on Energy 2020: A strategy for competitive, sustainable and secure energy, which set political orientations for the EU energy strategy for 2011-2020 in particular as regards the internal energy market, energy efficiency, infrastructure, research and innovation in low-carbon energy technology, indigenous energy sources and production, as well as external energy relations.

These Council conclusions, setting political orientations on two Commission communications (Energy 2020 strategy and Energy infrastructure priorities), come as a complement to the conclusions on energy drawn by the European Council on 4 February 2011.