Heads of government fail to rectify competitive situation 

By Torben Hvidsten, 14. March 2007

When EU heads of state and government met on Thursday and Friday last week they agreed that something needed doing to strengthen competition in the internal energy market. But what that something was remained undecided.

Nevertheless, they were able to agree on the definite separation of supply and production activities from the operation and control of the electricity grid. Simply as a means to secure equal and open access to transport infrastructure among the players. And to safeguard the independence of decisions on infrastructure investments.

It was also agreed that the independence of the national energy supervisory authorities should be strengthened. But no agreement was reached that companies tied to groups owning both production and transmission should be kept apart or that responsibility for systems should be located in self-contained, independent companies. In other words the heads of government agree on the problems but not the solutions and this tension is not expected to be resolved until after the summer holidays when the Commission brings forward a new proposed Directive for new regulation of the EU energy markets.

The Danish Energy Association is frustrated that member states have not achieved greater agreement on the need to find common solutions to speed up competition in the EU. A clear political signal from the heads of state and government on the direction of the future energy market would have made negotiations on the coming Directive much easier. It would also have put pressure on those countries which still lag behind in opening up their markets to competition.


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