The electricity market in Italy was launched by the Decree 79 of 1999 transposing the EU directive on "common rules for the internal energy market" (96/92/EC). This decree set out the process of liberalization of the energy sector which would, in some years and applicatingof new rules, led to the current market organizational structure. The legislator's goal was the creation and the regulation of an effective market for electricity generation and sale of electricity based on the principles of competition, transparency and neutrality. The sector changed from a monopoly to a complex mechanism, with a plurality of parties competing to offer services and products to customers rather than users. Currenclty are present in the market: production companies, one transmission operator (Terna SpA), distribution companies and market operators active in energy trading and supply delivery. Among these, EGL Italy founded in 2000 together with the opening of the new market.
The prospect of generating value on the energy sector attracted major investments allowing a significant technological modernization, improved service and the range of services and products choice. With the opening of the free market also the regulated market was set governing the relationship between supply and demand. From 1 January 2005, operators can buy energy to cover their energy consumption in the energy exchange (MPE Spot Electricity Market), while the launch of the futures market in electricity (MTE) and the electrical derivative exchange (IDEX Italian Derivatives Energy Exchange in November 2008) have completed the framework of a new dinamic market, now in a position not only to allow the physical supply of energy, but to provide better coverage and give indications of future price for an extended period. At the same time the regutator wanted to ensure an adequate safety to the system through the availability of power production capacity to balance the grid.
The electricity market has been structured identifying the roles of different actors (producers, customers, managers, regulators, controllers) as well as defining the different trading venues of different products and services. In particular have been created the following companies: the Electricity Services Operator (GSE), the Manager Energy Markets (GME), entrusted with the organization and the management of the electricity market, and the Single Buyer (AU) which is given the role of guarantor for the supply of electricity to households and small businesses.
The physical process of power generation and supply to cover consumption is of course at the basis of this complex system, while an Authority specially constituted (The Authority for Electricity and Gas) is overseeing the entire market .
Electricity Market
