We combine expertise on the design of efficient markets, an in-depth knowledge of the development of the Nordic and European power markets and long experience analysing the market on behalf of public authorities and market players. These are required to understand how markets are affected by and contribute to the efficient transformation of the energy system.
We have sound economic expertise and long experience working on projects related to the development of power market design in the Nordics and the rest of Europe. We advise Norwegian, Nordic and European authorities on market design, and help market players and interest organisations understand how alternative models would work.
Getting the market design right is essential for both the efficient use of resources and the decarbonisation of the economy. At the same time, not all decisions can be left to the market; effective markets depend on the presence of effective regulatory frameworks. The current Nordic market design is the product of three decades of development and will need to adapt further to function effectively in a future with more renewable, variable and distributed generation capacity, a greater need for flexibility, consumers who can actively participate in the market and in which we see new technologies being applied and new uses for electricity. How markets are organised and new players access them will play an increasingly important role in determining whether new resources and technological opportunities can be used efficiently.
The electrification of transport, energy efficiency and consumer flexibility are all examples of the economy’s decarbonisation. These changes are already resulting in the development of new markets and affecting existing markets. Examples include the markets for public electric vehicle charging and for energy services, in which traditional electricity supply is bundled with sophisticated energy management solutions. Using markets effectively in the transformation of these areas of the economy requires an understanding of how power markets work physically, technically and economically.
Our services related to policy, regulation and market design are based on the needs of public authorities’ and market actors’ need for professional analysis and advice on:
- How markets should be designed to ensure the efficient use of resources
- How markets and regulation can work together to provide efficient price signals and incentives and thereby support efficient investments in infrastructure, generation capacity and end-use.
- How regulation should be designed to ensure the efficiency of markets and the achievement of social objectives
- How market participants can make use of the commercial opportunities provided by different regulatory frameworks
Our analysis and advice rely on a combination of proven economic theory and a thorough understanding of markets, technical and commercial conditions and, not least, the interaction between markets and regulation.
We carry out market design projects on behalf of Norwegian, Nordic and European authorities, interest organisations, system operators and energy and industrial companies.
We provide analysis on several issues related to market design developments in the Nordics and Europe. Among other things, we have
- Advised on how the Nordic market model could be developed to secure the most socially valuable investment in new generation capacity when accounting for flexibility and location characteristics in addition to investment and operation costs.
- Led a comprehensive survey of market design in all EU member states as part of the foundational analysis for the European Commission’s Clean Energy Package.
- Advised on changes to the regulatory framework for renewable energy to support both its integration into the market and the more efficient use of resources.
- Analysed how the trend increase in Intraday trading could affect the Day-Ahead market.
- Evaluated various capacity mechanisms concerning how they affect the efficiency of power markets in Europe and advised on how to they could be organized more effectively, including how they could be opened up for cross-border trade.
- Analysed how flow-based market coupling in the Nordic region will affect trade in the power market.
- Analysed the efficiency of the financial market for power in the Nordic region and whether proposed interventions would increase efficiency.
- Analysed the effects of alternative models for interconnector power trading and capacity allocation.
- Explained how markets for the use of consumer flexibility could be designed.
- Analysed how existing market models for electric transport should be adapted to support the further electrification of the transport sector.