Europe

The European Union (EU) is committed to ensuring security of supply, fighting climate change, strengthening the competitiveness of the energy sector, protecting consumers and promoting European solidarity. To achieve these objectives, the EU promotes the liberalisation of energy markets and encourages the exchange of energy between member states, with the aim of achieving a European Energy Union with an integrated internal energy market.

To this end, European legislators have given national energy regulators key responsibilities to ensure:

Non-discriminatory access to gas and electricity networks
Effective competition between market players
Optimised interconnection of the different national networks

Since national energy policy is largely governed by legislation established by the European Union, regulatory cooperation at European level is essential for ERSE to fulfil its mission. Close collaboration between European counterparts is a pillar for ensuring a reliable, competitive energy market that protects consumer rights.

ERSE issues an annual report on the electricity and natural gas markets in Portugal, to be submitted to the European Commission and the Agency for the Cooperation of Energy Regulators (ACER), in which it presents the main developments in the markets, including the issues of competition (both in the wholesale and retail markets), security of supply and consumer protection. The report also covers the regulatory measures adopted and the results obtained with regard to ERSE's annual activity, and aims to provide up-to-date information on the Portuguese energy market.

Annual Report on the Electricity and Natural Gas Markets

Legal framework

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The European Union's energy policy promotes the development of sustainable, secure and economical energy, with the following main objectives:

Diversify Europe's energy sources and guarantee energy security through solidarity and collaboration
Maintaining a fully integrated internal energy market, allowing the free movement of energy within the EU without technical or regulatory restrictions
Increase energy efficiency in order to reduce energy imports, minimise emissions and create jobs and growth
Decarbonise and migrate to a low-carbon economy, in line with the Paris Agreement
Prioritise research and innovation in the field of clean and low-carbon energy to boost the energy transition and increase competitiveness

To fulfil these objectives, over the years the European Union has adopted a wide range of legislation on the design and operation of European energy markets. In order to promote knowledge and the opportunity to participate in the development of the European energy sector, the European Commission is putting all its proposals out to public consultation.

European Green Deal

In December 2019, the European Commission announced an ambitious agenda called the European Green Deal which aims to transform the European Union into an equitable and prosperous society with a modern, resource-efficient and competitive economy that has zero net greenhouse gas emissions by 2050, and where economic growth is decoupled from resource utilisation.

Fit for 55

The current European regulatory framework for energy is based on the important Fit for 55 legislative package, initially designed to align all climate and energy objectives. It should be remembered that, under the European Climate Law, the European Union has committed itself to reducing its net greenhouse gas emissions by at least 55 per cent by 2030.

This package of 19 pieces of legislation is not limited to energy, also covering measures for the climate, environment, transport, industry, agriculture and sustainable finance, with a view to decarbonising society. This framework was reinforced by the REPowerEU plan, designed to quickly and completely eliminate Russia's dependence on fossil fuels by accelerating the adoption of renewable energies, increasing energy efficiency and diversifying energy supplies.

Electricity market design

As far as the electricity sector is concerned, a reform of the electricity market design was adopted in 2024, reconfiguring some aspects to ensure the proper functioning of a decarbonised, renewable and more inclusive electricity sector. The changes concern the rules set out in the ‘Clean energy package for all Europeans’ of June 2019. This package updates and strengthens the legislation that was previously introduced by the ‘Third Energy Market legislative package’.

Market design for renewable gas, natural gas and hydrogen

Also in 2024, within the framework of Fit for 55, the new legal framework for achieving the decarbonisation of the natural gas sector was adopted. The amendments to the Directive and the Regulation on common rules for the internal gas market aim to facilitate the integration of renewable gases and the development of the hydrogen sector.

Together, these initiatives form a solid regulatory framework that guides the EU towards a sustainable, secure and competitive energy future.

Legal documentation

Institutional framework and multi-sectorial texts:

Electricity:

Natural Gas, Renewable Gases and Hydrogen:

Renewables and Energy Efficiency:

European Network Codes:

Institutional relations

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ERSE ensures its European regulatory coordination through two structures for co-operation between regulatory bodies:

The Agency for the Cooperation of Energy Regulators (ACER)
The Council of European Energy Regulators (CEER)

ERSE's participation is carried out through technical working groups, which meet regularly to develop reports, approve technical methodologies and promote good regulatory practices.

ACER

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ACER - the Agency for the Cooperation of Energy Regulators is a specialised agency of the European Union, established in 2011, which supports the work of the 27 national regulatory authorities of the Member States and encourages mutual coordination and cooperation.

ACER's organisational structure consists of an administrative board, a board of regulators, a director, a board of appeal and regulatory working groups, as defined in an EU Regulation.

ACER:

Mediates conflicts between regulatory bodies
Publishes rules to ensure good regulatory practice at European level
Issues opinions, recommendations, or binding decisions on matters within its remit
Monitors the performance and development of European energy markets
Monitors the transparency and integrity of wholesale energy market, within the scope of REMIT

ERSE actively co-operates in several ACER's activities:

Participating in meetings of the Council of Regulators
Providing technical staff to accompany and participate in working groups and prepare joint work
Coordinating these working groups, when appointed to do so

Working groups

The working groups are foreseen in ACER's own regulations and support the regulatory work carried out by the Agency, promoting debate and the production of reports or other types of documents that enable ACER to fulfil its objectives. The Agency's working groups are divided into thematic areas:

ACER REMIT Committee (ARC)

Electricity (AEWG)
Gas (AGWG)
Retail Markets (ARWG)

ERSE chairs the AGWG since March 2019 and co-chairs the ARWG since its inception, early 2021.

Within each working group there are several task forces, Dentro de cada grupo de trabalho existem ainda várias equipas técnicas (task forces, no inglês), compostas por peritos especializados, que trabalham sobre temas específicos.

For more information consult ACER’s website.

To know and participate in ACER’s public consultations, click here.

CEER

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CEER - the European Council of Energy Regulators is a Belgian non-profit organisation, established in 2000, which brings together regulators from 39 European countries and whose objectives are:

Develop the energy market for the benefit of the consumer
Serve as a forum for the exchange of knowledge and experience between regulators
Promote solutions to problems that are common to all the countries involved and whose resolution requires coordinated action
Publicise and defend the vision of energy regulators to various European players in the sector

CEER's organisational structure consists of a general assembly, a board of directors, a secretariat and working groups. CEER's objectives are defined by specialised working groups.

ERSE actively co-operates in several of CEER's activities:

Taking part in meetings of the general assembly and the board of directors
Making technical staff available to accompany and participate in the working groups and prepare joint work
Coordinating these working groups, when appointed to do so

Working groups

CEER's working groups are made up of experts from the various national regulatory authorities and are divided into thematic areas

Distribution Systems (DS WG)
Consumers and Retail Markets (CRM WG) Gas (GWG)
Electricity (EWG)
Market Integrity and Transparency (MIT WG
International Relations (IRG WG)

In addition to chairing CEER since its foundation until 2005, ERSE held the position of Chair of the Gas Working Group (GWG) between 2016 and 2017, a position it has held again since March 2019.

Since March 2021, ERSE is part of the CEER Vice-Presidency, in the person of Professor Pedro Verdelho.

Between 2017 and 2021, ERSE was Vice-Chair of the Consumer and Retail Markets Working Group (CRM WG), having taken on the role of Co-Chair from 2021. It has also led the sub-working group on wholesale energy markets (WEM WS) since May 2018.

Within each working group there are also various technical teams made up of specialised experts who work on specific topics.

For more information, consult CEER’s website.

To know and participate in CEER’s public consultations, click here.

Iberian energy market

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The Iberian Energy Market is the name given to the energy agreements signed between Portugal and Spain, with the aim of creating a competitive, free market, open to the entry of new participants, which moves towards greater economic efficiency and the creation of better service conditions for consumers.

The Iberian Energy Market is made up of two areas: MIBEL (Iberian Electricity Market) and MIBGAS (Iberian Natural Gas Market).

Iberian electricity market (MIBEL)

MIBEL was created by the Santiago de Compostela Agreement of 1 October 2004, which was subsequently revised and concluded in Braga on 18 January 2008. MIBEL provided for the creation of a Council of Regulators, on which the following are represented:

The Spanish regulators:
- Comisión Nacional del Mercado de Valores (CNMV)
- Comisión Nacional de los Mercados e la Competencia (CNMC), formerly Comisión Nacional de Energía (CNE)
The Portuguese regulators:
- Comissão do Mercado de Valores Mobiliários (CMVM)
- Entidade Reguladora dos Serviços Energéticos (ERSE)

The Council of Regulators:

Monitors the development of the Iberian Market
Issues opinions on very serious offences that have been committed
Coordinates its actions with the other regulators
Monitors energy contracting mechanisms for last resort suppliers
Submits proposals to the Portuguese and Spanish governments for changes to regulatory rules, together with other regulators
Determines each year which companies should be considered dominant operators

To know more about MIBEL, go to MIBEL

Iberian gas market (MIBGAS)

In the context of the convergence of the Portuguese and Spanish energy markets, initiated by MIBEL in 2007, the development of MIBGAS was agreed.

ERSE and its Spanish counterpart, CNMC, developed a document on the ‘Organisation and Operating Principles of the Iberian Natural Gas Market’ (in Portuguese only). This document stipulates that the two regulators are responsible for

Being part of the MIBGAS Coordination Committee
Analysing the functioning of the market
Drawing up a study of the conditions for obtaining a supply licence and proposing measures to harmonise these conditions
Drawing up a joint proposal for regulating transit tariffs between Portugal and Spain

To find out more about MIBGAS, go to MIBGAS

Trans-European Energy Networks

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EU Regulation 2022/869 establishes guidelines for the timely development and interoperability of priority corridors and areas of trans-European energy infrastructures, which contribute to ensuring climate change mitigation and the integration of the European energy market and system. In particular, this Regulation:

Identifies 11 priority corridors in different geographical regions for electricity infrastructure, offshore networks and hydrogen EU
Provides for the identification of projects of common interest (PCI)
Facilitates the timely implementation of CIPs through streamlining, closer coordination and acceleration of licensing procedures, as well as increased transparency and public participation
Establishes rules for the allocation of cross-border costs and risk-related incentives for CIPs
Determines the eligibility conditions for KIPs to receive financial assistance from the Union.

Article 17(6) of the Regulation in question states that each national regulatory authority must publish its methodology and the criteria used to assess investments in infrastructure projects and the major risks incurred by these projects, updated taking into account the latest developments in legislation, policies, technologies and the market.

Regarding this topic, ERSE developed the document Methodologies and evaluation criteria for investment projects in gas and electricity infrastructures.

This document briefly presents the legal framework for approving investments in electricity and gas transmission infrastructures, as well as the regulatory methodologies that currently apply to electricity transmission and gas transmission activities, explaining the risks to which operators are subject and the mitigation measures that these methodologies provide. both from

To prepare this document, ERSE took into account Recommendation No 3/2014 and the Report on Investment Evaluation, Risk Assessment and Regulatory Incentives for Energy Network Projects, both from ACER.