A Systematic Review of European Electricity Market Design Options

Abstract

The European electricity market model continues to evolve in the face of new challenges. This systematic literature review aims to assess the status of research and discussion on the current model and its market mechanisms. In addition, it aims to ascertain the kinds of modelling tools that have been used to model market mechanisms or formulate proposals for changes to current practice. The results show that the challenges of individual market mechanisms have been identified quite extensively in the research sample. However, the number of papers identified for inclusion in the systematic literature review was quite small, from which it can be concluded that there are surprisingly few publications focusing on this particular topic. Nevertheless, the trend indicates a probable increase in research in the subject area in the future. The general standpoint among researchers seems to be that the goals set by the EU are, as it were, a law of nature that cannot be deviated from. Consequently, new radical change proposals or comprehensive reforms were not encountered in the study. In addition, it was found that optimization was the most commonly used modelling method in the papers included in the literature review.