The new annual report on the implementation of Community legislation on the opening of the electricity and gas markets is even more provocative than the previous one. This time, the European Commission is angry and explicitly recognises that although the Directives 2003/54 (electricity) and 2003/55 (gas) were correctly applied - which is far from being the case - they need to be strengthened. All the actors concerned have known the foreseen fields of action for a long time: non-discriminatory network access, unfair competition, a favourable framework for investments and smaller customers. After winning the support of the member states, which it will strive to get from the European Council in the spring, the Commission will therefore propose a third liberalisation package,' even if this wording is not explicit in its report. Without mentioning the date in its report (this date is only mentioned in its overall strategy), this would likely mean that it would take three years to tidy up the existing legislation, if this process was completely applied.


So will this unbundling (separation of the network activities) involve ownership or not? The big question in the news in late 2006 was ultimately played down at the explicit request of the European Commissioners Barroso (President) and Verheugen (industry). Commissioners Kroes (competition) and Piebalgs (energy), who were in favour of getting rid once and for all of the conflicts of interest between generation/supply and transmission/distribution of energy, were unable to counter the opposition of Paris and Berlin to the obligatory transfer of network ownership. But the Commission had to propose something on this very sensitive question. So it is proposing, though with little conviction, ownership unbundling and, as an alternative option, the creation of an independent network operator which would be responsible for implementing the maintenance and development of the network. However, ownership of the networks would remain with the vertically integrated incumbents, which would receive a fixed return by law for operating their networks. It goes without saying that the transmission system operators (TSOs) are not very keen on this alternative solution.

While the report argues clearly for the first option, European leaders will have to decide in the spring. The same applies to the powers of the regulators: the report clearly comes out in favour of a strengthening in the following areas...

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT