The European Union's energy policy has set as a priority the achievement of an integrated European energy market, which will offer a more economically efficient and competitive system of electricity and gas, enhanced security and cross-border solidarity with the inclusion of an increased share of renewable energy sources and improved energy efficiency systems. The above are indisputable bases for the European energy transition to a more efficient and cleaner energy environment. The road to European energy integration requires both the development of the necessary infrastructure and the alignment of the rules and policies of individual energy markets of the member states.


In the phase of achieving the fully integrated European energy market, the safe and affordable energy supply to the citizens of the European Union will be ensured in the most economically efficient way. Through common rules for the energy market and cross-border infrastructure, the energy that can be produced in one European Union country will be delivered to consumers in another country. This will keep prices under control, creating competition and allowing consumers to choose energy suppliers.

EU Target Model


The European Union's plan to achieve a single European energy market stipulates that the common market should be structured into four (4) individual different markets: a) the Day-ahead Market, b) the Intraday Market c) the Forward Market and d) the Balancing Market, a structure that constitutes the Target Model.

When the Power Exchange markets of the Member States of the European Union participating in the Target Model are in a single coupling mode, at day ahead market level, auctions are held, whereas at intra-day market level continuous trading takes place, processes during which the orders of the Participants collected are matched while at the same time the inter-zonal capacity for different bidding zones is allocated at a pan European level.

In the frame of operational risk management and in order to reduce the exposure of market participants to price fluctuations, there is also the organized market of energy derivatives (energy financial market).

Regulatory Authority for Energy (RAE) and the Hellenic Capital Market Commission (HCMC) cooperate for the effective carrying out of their competence, as well as for the implementation of the legal framework which relates to the operation, the integrity and the transparency of the energy market, within their supervising role and according to EU law.

Market Coupling


Before the introduction of Market Coupling, cross-border capacity on one hand and electricity on the other hand, had to be purchased separately. This means that a trading member had to reserve cross-border capacity in a first step, before using this capacity to transport the electricity bought in a second step. Market Coupling uses so-called implicit auctions in which market participants do not individually receive allocations of cross-border capacity, they just bid for the electricity on the Exchange. Power Exchanges then take into account available cross-border capacity in the price calculation process, in order to minimize the price difference in different market areas.


In so doing, Market Coupling maximizes social welfare, avoids artificial splitting of the markets and sends the most relevant price signal for investment in cross-border transmission capacities. The efficiency of Market Coupling is furthermore proven by an increasing price convergence between market areas.

Price Coupling of Regions


Price Coupling of Regions (PCR) is the project of European Power Exchanges to develop a single price coupling solution to be used to calculate electricity prices across Europe, respecting the capacity of the relevant network elements on a Day-Ahead basis. This is crucial in order to achieve the overall EU target of a harmonised European electricity market. The integrated European electricity market is expected to increase liquidity, efficiency and social welfare. PCR is open to other European power exchanges wishing to join.

The project is currently being carried out by nine Power Exchanges: EPEX SPOT, GME, HenEx, Nasdaq, Nord Pool, OMIE, OPCOM, OTE and TGE. PCR is used to couple the following countries: Austria, Belgium, Czech Republic, Denmark, Estonia, Finland, France, Germany, Hungary, Italy, Latvia, Lithuania, Luxembourg, the Netherlands, Norway, Poland, Portugal, Republic of Ireland, Romania, Slovakia, Slovenia, Spain, Sweden and UK. The initiative started in 2009 and the PCR parties signed the PCR Cooperation Agreement and PCR Co-ownership Agreement in June 2012. One of the key elements of the PCR project is the development of a single price coupling algorithm, which was given the name EUPHEMIA (acronym of Pan-European Hybrid Electricity Market Integration Algorithm). It is used to calculate energy allocation, net positions and electricity prices across Europe, maximising the overall welfare and increasing the transparency of the computation of prices and power flows resulting in net positions.

Detailed information regarding the European Market Coupling, can be found here.


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