Market Structure Overview

The current market structure for energy pricing has come under scrutiny, particularly regarding the marginal pricing model. This model, where the most expensive energy source determines overall prices, has sparked discussions about potential revisions to better meet consumer needs and distribute welfare more evenly. Although some argue that the market isn't failing, the situation highlights a disconnect between market efficiency and the reliable delivery of energy to consumers at reasonable costs. The European Commission’s recent consultation aims to explore these issues and consider alternatives that could more effectively shield consumers from high fossil fuel prices.