Europe’s electricity sector must adapt to a new reality in which consumers are increasingly becoming producers, while policymakers debate reforms that could significantly reshape the energy market, according to Valeriu Binig, a leading specialist in the energy market in Romania.
Speaking during an industry discussion, Binig argued that the traditional concept of electricity “consumption” is becoming outdated as self-generation expands rapidly across Europe through rooftop solar and other decentralized technologies. “We should replace consumption with demand. Demand is consumption minus self-production, and self-production is now sensitive,” Binig said, at Energynomics Day, on the premises of the Green Energy Expo & Romenvirotec.
As households and companies generate more of their own electricity, the amount of energy drawn from the grid becomes a more relevant indicator for the functioning of the power system.
Beyond this structural shift, Binig warned that the European energy sector is facing several emerging policy risks that could affect market stability and investment flows. One of the most closely watched developments is the debate over reforming the European electricity market design. European leaders are scheduled to meet in Brussels on 18-19 March to discuss possible changes, amid growing political pressure related to the role of carbon pricing and the functioning of wholesale power markets.
Some policymakers have argued that renewable energy producers benefit from “windfall profits” because they receive the marginal market price set in the day-ahead electricity market, even though their production costs are typically lower. Proposals under discussion include splitting the market or removing the effect of CO2 prices from the market clearing price, measures that could lower wholesale electricity prices but also alter market signals.
According to Binig, the utility industry is urging caution, noting that the sector must mobilize investments of around 5 trillion euros over the next decade to finance the energy transition, but any major regulatory uncertainty could discourage investors and delay projects.
Another challenge identified by Binig is the growing push within Europe for „Made in Europe” requirements in energy supply chains. Policymakers are increasingly discussing procurement rules that would prioritize equipment manufactured within the European Union. While the objective is to strengthen European industrial capacity, such measures could also create supply chain bottlenecks and increase costs for energy projects. Also, equipment needed for renewable energy installations could become more expensive and harder to obtain, ultimately leading to higher electricity prices.
Binig also noted that the energy sector is trying to promote a more balanced approach based on partnerships and diversified supply chains, warning that overly rigid localization requirements could backfire and place additional pressure on both the industry and consumers.
The conference Energynomics Day was organized by Energynomics, on the premises of the Green Energy Expo & Romenvirotec, with the support of our partners: Elektra Renewable Support, Baringa, Big Store, Think Blu Solution.