The European Commission proposed a new energy policy package on
Wednesday, seeking to split European energy giants and curb foreign
takeovers in an effort to boost competition and ensure security of
supply.
"An open and fair internal energy market is essential to ensure
that the European Union (EU) can rise to the challenges of climate
change, increased import dependence and global competitiveness.
This is about getting a better deal for consumers and business and
making sure that third country companies respect our rules," said
European Commission president Jose Manuel Barroso, who presented
the third package of its kind.
Despite progress made after the opening up of the European
energy markets to competition, a process which started 10 years
ago, the commission said there were still serious challenges
regarding all aspects of energy provision and use.
One outstanding problem stood with big European energy companies
such as RWE and EON in Germany and EDF and Suez in France, which
now control both the generation and the transmission of their gas
and electricity.
The EU's executive arm has long sought separation of production
and supply from transmission networks in the energy sector. In its
controversial proposal, it listed two options, the so-called
ownership unbundling and the approach of "independent system
operator."
Under the ownership unbundling, an option preferred by the
commission, EU energy giants will be forced to sell of their
transmission networks. In other words, a single company can no
longer own both transmission and be occupied in energy production
or supply activities.
The commission said ownership unbundling solves the inherent
conflict of interest, which leads to discriminatory behavior.
Network operators will no longer have related supply or production
companies which they could treat differently from competing
companies.
It also guarantees non-discriminatory access to network
information and provides unbiased incentives for investments, which
will guarantee security of supply.
However, this extreme approach had already met strong opposition
from several member states, notably Germany and France, which are
home to some big names in the energy sector.
The independent system operator solution will ensure similar
results, provided that it is applied in full and provided it is
combined with strong regulatory oversight, the commission said.
The proposal was yet to win unanimous approval from divided
member states. Currently, Britain, the Netherlands, Denmark,
Belgium, Finland, Romania, Spain and Sweden support the unbundling
of energy companies, while half a dozen others, led by France and
Germany, reject it.
The EC also proposed certain restrictions on foreign takeover in
the energy sector, making it difficult for non-EU companies to
acquire European transmission networks.
Currently, Russian state-controlled energy giant Gazprom, one of
the largest suppliers of gas to the EU, is meeting resistance for
its plan to by pipelines and other infrastructure.
The Russian company said on Tuesday it was a reliable gas
supplier and a major investor in the infrastructure that brings gas
to Europe.
"We share the EU's core goal of ensuring long-term security of
energy supply to the EU," a spokesman said.
Among other measures, the commission's proposal also foresaw an
EU agency for the cooperation of national energy regulators, with
binding decision powers to facilitate cross-border energy trade. A
new European Network for Transmission System Operators will be
established to promote cross border collaboration and
investment.
(Xinhua News Agency September 20, 2007)
