Pawel Lont

Pawel Lont is a PhD candidate at the Faculty of Economics and Sociology at the University of Lodz, Poland. Pawel holds a Master’s Degree in Finance and Accounting, as well as a degree in Electric Power Engineering. His studies focus on electricity and natural gas markets across Europe, prospects for their further integration and the application of market mechanisms as means to achieve carbon neutrality in the future.

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Issue: 10:3 (The thirty nineth issue)

Many years have passed since the first liberalization processes in the electricity sectors the in European Union that were performed in order to establish a single market for electricity. In practice, convergence between neighbouring market areas was established mainly between the Member States in Central-Western Europe, while other countries have allowed for only limited levels of competition. As a consequence, many market areas remain illiquid and consumers pay relatively higher prices for the energy they consume. The final bill is further increased through financing the increasingly ambitious climate agenda, gradually leading to social opposition against ever-growing prices. The aim of this article is to provide examples of differences in market functioning in Member States, leading to discrepancies in average energy costs for end consumers. The consequences of different levels of market concentration, infrastructure investments and renewable generation subsidization are analysed using publicly available statistics. Careful literature review is also performed before the conclusions are presented.