On 14 September 2011, the European Parliament took an important step towards the approval of the EU Regulation on Energy Market Integrity and Transparency (REMIT). REMIT will cover all wholesale energy trading in the EU, including contracts and derivatives for the supply and transportation of natural gas and electricity.
This will be of interest to all stakeholders in wholesale gas and electricity markets and others, in addition to those involved in commodity and emissions trading, as well as the aviation sector.
REMIT aims to protect end consumers and prevent market abuse in wholesale energy trading through creating more transparent pricing across the EU. The President of the European Parliament, Jerzy Buzek, said of REMIT, “I welcome this important regulation which guarantees transparency and prevents abuses in wholesale energy trading ensuring affordability and fairness in the market.”
These outcomes are to be achieved through the implementation of new rules, including:
- prohibiting abusive practices affecting wholesale energy trading markets, such as the use of insider information and market manipulation;
- requiring Member States to implement penalties for the infringement of REMIT;
- drawing up an EU register based on national registers listing market participants; and
- independently monitoring all wholesale energy trading deals across the EU.
The newly established Agency for the Cooperation of Energy Regulators (ACER) will undertake the monitoring of all trade deals.
The text of REMIT, as adopted by the European Parliament, is available here. REMIT will now need to be approved by the Council of Ministers. This is expected to take place in October.
REMIT as a whole will enter into force 20 days after its publication in the EU Official Journal but a number of provisions will have effect at the times set out in the Regulation.
As REMIT is an EU Regulation, it will have direct effect in the EU Member States, meaning it will be enforceable directly against EU enterprises, regardless of whether the relevant Member State has introduced national implementation measures.