Reducing CO2 emissions and deregulating the electricity sector in Europe: A contradictory development?

Electricity generation is the single most important sector in which CO2 reductions are achievable, with
advanced generation technologies available and the existence of a centralised production structure, if
compared to the transport or the industrial sector. It is a market undergoing a radical change in Europe,
with competition rising as it is enforced by the deregulation of the markets, though to varying degrees on
a national level. At the same time it is a sector characterised by efforts to support green energy systems
and also by the increasing significance of international trade. It is therefore of interest to examine the
impact of the technological and economic changes on the CO2 emissions due to electricity generation, in
order to try to assess the feasibility of the emissions’ reduction policies as foreseen by a series of treaties
and protocols. The points discussed in this paper focus on the interference of the recent market developments,
the policies and economic tools applied in Europe and the state of the art conventional and
renewable generation technologies, with respect to their contribution to the aim of reducing emissions.