In brief
Regulation (EU) 2024/1106 (“REMIT II”), effective 7 May 2024 together with its draft implementing regulation, adopted end of January 2026 materially updates the EU rules governing transparency and integrity in wholesale energy markets. Despite being presented as a simplification of the original 2011 Regulation on Wholesale Energy Market Integrity and Transparency (REMIT) framework, the revised regulation significantly broadens its scope, introduces new reporting layers, and shortens key reporting deadlines, increasing compliance obligations for a wide range of energy market participants.
Key takeaways
- Hydrogen markets are included but subject to a phased in approach.
- Energy storage is regulated through existing electricity reporting structures.
- Exposure reporting introduces forward looking regulatory scrutiny.
- Centralized data flows do not shift legal responsibility.
- REMIT II demands more automation, governance and contractual clarity.
In more detail
REMIT establishes the EU’s core prohibitions against market abuse in wholesale energy trading and requires market participants to register and report relevant data. The 2024 amendments of REMIT II and its implementation reflect increased market complexity, the emergence of new energy carriers, and heightened regulatory scrutiny. As a result, companies operating in EU energy markets should reassess their reporting frameworks, internal controls, and contractual arrangements to ensure alignment with the revised requirements.
Expanded scope: hydrogen and energy storage
While the previous regime focused on a dual commodity model limited to electricity and natural gas, REMIT II expanded its scope to include innovative energy commodities and clean technologies such as storage and hydrogen installations, creating a level playing field for market participants regardless of the technology they utilize. This expansion reflects the growing influence of these technologies on energy markets and will significantly increase the volume of transactions subject to reporting.
Hydrogen is now expressly included in the definition of wholesale energy products (WEPs), covering supply, transportation and storage contracts. This reflects the EU’s objective of aligning emerging energy markets with financial grade standards of transparency and integrity. The regulatory approach is notably cautious. Hydrogen reporting is relegated to the periodic reporting category: annual reporting will apply from 1 July 2028. Furthermore, exemptions exist for small hydrogen producers (≤ 50 MW), geographically confined hydrogen producers as defined in Directive (EU) 2024/1788), and small energy-intensive users (<600 GWh/year).
REMIT II also formalizes the role of energy storage, while utilizes a “legal fiction” for Battery Energy Storage Systems (BESS). There is no separate “electricity storage” reporting category; instead electricity injection and offtake are treated identically as electricity supply and must be reported using the existing table formats. While this approach streamlines compliance by relying on established reporting structures, it should be considered alongside the enhanced oversight of balancing services, which are often central to BESS business models. Moreover, treating BESS transactions as conventional supply contracts may obscure certain technology specific characteristics such as flexibility driven risk profiles and rapid battery cycling that distinguish BESS from traditional generation assets.
Balancing services: from ad hoc to periodic reporting
In parallel, balancing services move from ad hoc reporting upon a request with European energy regulator ACER to mandatory periodic monthly reporting. Where a single contract (such as a Flexible Purchase Agreement) covers both market trading and the provision of grid-balancing services, market participants must ensure that the contract is reported under both applicable frameworks. Importantly, ultimate legal responsibility for the completeness, accuracy, and timeliness of reported data remains with the market participants (i.e., both counterparties), requiring careful contractual allocation of delegation mechanisms and related obligations.
A multi-tiered reporting architecture
REMIT II replaces the former binary distinction between continuous reporting and ad hoc reporting with a three-tiered reporting structure, designed to enhance ACER’s monitoring capacity while avoiding disproportionate burdens for lower risk activities. This periodic category also serves as a pragmatic treatment for nascent or low-volume markets.
Periodic reporting
A formal periodic reporting category is introduced for market activities that were previously considered “insignificant” or reportable only upon ad hoc request, such as electricity balancing services. This includes balancing transactions (monthly aggregated reporting), natural gas storage contracts with a duration of 12 months or longer, and hydrogen transactions (annual reporting from July 2028).
Continuous reporting: revised deadlines
Within the continuous reporting category, the draft Implementing Regulation alters reporting timelines to eliminate perceived regulatory blind spots. The deadline for bilateral over the counter (OTC) contracts is shortened from one month to 10 working days, which forces participants to migrate from manual tracking toward more automated internal systems. The reporting deadline for Organized Marketplace (OMP) transactions is extended from one (D+1) to two working days (D+2), as a pragmatic concession to the immense data volumes generated by modern intraday and algorithmic trading. While OMPs now operate as the centralized channel for order book data, market participants continue to bear full responsibility for reporting their bilateral OTC transactions, now at a pace nearly three times faster than under the previous regime.
Exposure reporting
The most ambitious innovation is the introduction of exposure reporting. From Q1 2027, market participants with annual volumes of 600 GWh or more must submit a monthly aggregated, forward-looking view covering net positions, forecasted production, and forecasted consumption for each of the 24 months following the reporting quarter.
This obligation shifts ACER’s focus from retrospective towards predictive, ex-ante surveillance, aimed at spotting inconsistencies between financial hedging and actual physical positions. Although framed as a “simplified”, aggregated framework, exposure reporting introduces new technical and operational challenges, particularly given the inherent uncertainty associated with forecasts.
Streamlining data reporting
Alongside the new reporting architecture, REMIT II seeks to streamline fundamental data reporting by shifting transmission to existing system operator infrastructures. Under the draft Implementing Regulation, entities such as the European Network of Transmission System Operators (ENTSO E for Electricity and ENTSO G for Gas) will technically submit certain production, consumption and transmission data on behalf of market participants via central transparency platforms. This data flow is channeled through the central information transparency platform, ensuring that ACER receives information as soon as it becomes available at the system-operator level.
However, REMIT II makes clear that this technical centralization does not shift legal responsibility.
As such, this creates a “trust but verify” burden where market participants are relieved of the act of transmission but are now contractually and legally required to implement rigorous internal procedures to audit the data submitted on their behalf. In other words, the administrative burden is not eliminated but shifted from technical data entry to legal and quality-control oversight.
Conclusion
Despite its stated simplification objective, REMIT II introduces a more complex and demanding compliance landscape, particularly for participants active in balancing markets, storage and flexibility services, hydrogen projects, or large trading portfolios. Faster reporting deadlines, forward looking exposure obligations and expanded scope all point to the need for stronger governance, automation and contractual clarity.
To help assess whether specific activities and assets now fall within the expanded scope of REMIT II, we have developed a practical REMIT II Waterfall assessment tool. To request a copy, please contact David Haverbeke or Emilie Malivert.