{"id":1485,"date":"2021-08-05T08:13:00","date_gmt":"2021-08-05T08:13:00","guid":{"rendered":"https:\/\/www.enerbrain.com\/?p=1485"},"modified":"2023-09-26T09:34:19","modified_gmt":"2023-09-26T09:34:19","slug":"the-energy-market-background-and-future-trends","status":"publish","type":"post","link":"https:\/\/www.enerbrain.com\/en\/the-energy-market-background-and-future-trends\/","title":{"rendered":"The energy market: background and future trends"},"content":{"rendered":"\t\t
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The energy market: background and future trends<\/h1>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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By Attilio Di Sabato\n<\/h6>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t
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The historical background.<\/strong><\/p>

\u00a0<\/p>

In Italy, the energy market has a very recent history. It was introduced by\u00a0Legislative Decree No 79 of 16 March 1999<\/strong>,<\/p>

known as the Bersani Decree in reference to the Minister in charge, which\u00a0 concluded after several iterations in a final step in\u00a0the Bersani bis Decree in 2007 and earmarked its final step to liberalise the electricity market.<\/p>

\u00a0<\/p>

This Decree<\/strong>\u00a0implemented the Directive\u00a096\/92\/EC of the EU Parliament and Council, which\u00a0established the creation of common rules for the EU single energy market.<\/strong><\/p>


<\/strong>Nowadays, the so-called \u201cfree<\/strong>\u201d market (where the price is determined based on competitive market dynamics) and the \u201cregulated<\/strong>\u201d market (where the price is determined every 4 months by the competent Authority), a legacy of what existed before the Bersani Decrees, co-exist for Residential Customers, who can choose one or the other at their discretion, while for Micro Enterprises, SMEs and Large Enterprises there is only the option of being supplied in the free market structure starting from January 1, 2021.\u00a0 The \u2018Major Protection Service\u2019 ceased for them, a system which ceases the \u2018regulated services\u2019.<\/p>

\u00a0<\/p>

For households, the transition to the Free Market will be complete in 2023, with the elimination of the \u201cregulated\u201d service known as\u00a0maggior tutela\u00a0<\/i>(major protection).<\/strong><\/p>


<\/strong>The\u00a0main differences<\/strong>\u00a0between the two markets are that, in the Free Market, customers are \u201cfree\u201d to choose their supplier, and each supplier establishes a price based on the demand and the offer on the \u201cPower Exchange\u201d, where energy is bought and sold \u201cwholesale\u201d.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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The numbers\u00a0<\/strong><\/p>

\u00a0<\/p>

Before continuing our journey into the Italian energy market, we want to share some useful numbers to give you a general idea of the sector.<\/p>


In 2019,\u00a0gross national production of electricity was\u00a0<\/strong>293,853 GWh per year<\/strong>, distributed among sources as follows:<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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However,\u00a0the electricity demand<\/strong>\u00a0was 319,622 GWh<\/strong>, meaning\u00a0that domestic production covered only 88.1% of domestic demand<\/strong>, the remaining part was imported from abroad\u00a0\u00b9.<\/p>

\u00a0<\/p>

In 2019, the number of\u00a0operators in the Energy Distribution sector<\/strong>, which manage the Medium and Low Voltage network in public concession, up to every single User\u2019s meter,\u00a0was 127, while the number of sellers was 723.<\/strong><\/p>

\u00a0<\/strong><\/p>

The free\u00a0market<\/i>\u00a0represents 52.1% of final customers, and consequently, the market for\u00a0major protection (where the price is periodically determined by the Public Decider)<\/i> reaches 47.7% of final customers \u00b2.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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The Structure\u00a0<\/strong><\/p>

\u00a0<\/p>

Let\u2019s take a step back:\u00a0how do sellers of electricity negotiate the raw material mentioned?<\/strong>\u00a0Through the \u201cwholesale\u201d electricity market were resembling a real \u201cstock exchange\u201d where Authorised Operators buy and sell large quantities of electricity daily.<\/p>

The statutory corporation which manages and guarantees the operation of this \u201cEnergy Exchange \u201d is the GME,\u00a0Gestore dei Mercati Energetici (Italian Power Exchange).\u00a0<\/strong><\/p>

\u00a0<\/strong><\/p>

Not only is the GME responsible for the electricity market, but also the natural gas market and the environmental market.<\/p>

While for the first two markets it is easy to guess the purpose of the traded material, for the third one it is necessary to elaborate a little. In the Market for the Environment several sectors are covered, such as the Green Certificates Market, the Energy Efficiency Certificates Market (MTEE), and the CO-FER Certification Market.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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How it works<\/strong><\/p>\n

 <\/p>\n

Let\u2019s focus on the Electricity Market, which is divided into:<\/p>\n