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Will national capacity mechanisms kill the single electricity market?

Various member states are either considering or are already in the process of implementing capacity mechanisms to provide incentives for power plant investments. Such dedicated investment signals will impact short-term electricity prices. Thus, an uncoordinated national roll-out of capacity mechanisms might risk undoing the 20 years of work that went into building the internal electricity market.

The seminar began with a background on the national plans in France, presented by Dominique Finon. Simon Skillings then provided background on the national plans in the UK. The seminar moved on to Marcel Cailliau who highlighted what this might mean for the European electricity market. Finally, the floor was opened for a discussion chaired by Bruegel Research Fellow Georg Zachmann.

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