In 2003, the EU passed a reform of the electricity market design, which includes, among other things, rules for support for fossil free electricity production by using two-way “Contracts for Difference” (CfD’s). The member countries have flexibility in how to implement the CfD’s, but they have to ensure efficient operation and active market participation. The CfD’s provide economic stability for producers and consumers, but at the same time, they can disturb the market dynamics.
In the project, it was investigated which role CfD’s can play in the future Swedish electricity system, including how the CfD can be designed so the distortion of the market incentives can be minimised. Furthermore, Ea provided recommendations on how a technology-neutral design of a CfD can be done.
The project ran from November 2023 to April 2024.
Find information about one of our projects in Türkiye here.