Power capacity mechanisms worry EU electricity traders

Power traders are concerned that a growth of interest in capacity mechanisms could threaten the potency of traded electricity markets across the European Union, while disrupting plans to forge a unified internal energy market

To many of its advocates, the production of electricity from renewable sources is the stuff of dreams: a way of harnessing ambient energy found naturally in the environment, with no marginal cost of producing each additional megawatt of power. There is just one big catch: it is almost entirely dependent on the weather. That means a reliable source of back-up capacity is needed, which typically has to come from fossil fuels.

As the European Union moves towards its goal of a low-carbon power sector