GDF warns against 'dangerous' EU energy liberalisation plans

Didier Sire, head of strategy division at Gaz de France, has repeated the case against EU plans to split up the production and distribution branches of large integrated energy firms.

Speaking to the Brussels press one day ahead of the Commission's proposals, he said ownership unbundling "does not resolve the real issues" such as lack of regulatory and market integration at European level. 

With climate change at the top of the EU's political agenda, the European Commission considers full liberalisation as a pre-requisite to guaranteeing a level playing field in the EU energy market, supply security and promoting investments in renewable energies and new network capacity.

But Sire said that such a move would "not guarantee future investments" in the new network which, he said, will be made by GRTgaz, a subsidiary of GDF, "regardless of its ownership status".

Moreover, he added, unbundling will "weaken gas operators" when they negotiate long-term contracts with large suppliers, such as Russia’s Gazprom, which are heavily integrated and do not hesitate to wield influence on European markets.

"This is a decision that risks deteriorating supply security," Sire warned. "Ownership unbundling is a dangerous proposal," he added, saying it could lead to "a strategic mistake if national specificities are not taken into account".

However, Sire's comments appear to be at odds with those made by Gazprom, which sees unbundling as a potential threat to its European activities. Speaking in December last year, Alexander Medvedev, Gazprom's deputy CEO, lashed out at the Commission's plans, saying that "the ghost of Communism is back with all the attempts to take ownership of infrastructure and divide it".

Sire admitted that the Commission's proposals would force Gazprom to choose between its supply and transmission activities and therefore weaken its position in Europe. He mentioned Wingas, a joint venture Gazprom operates with BASF subsidiary Wintershall in Germany as a potential asset that the Russian giant could be forced to sell.

On a separate matter, Sire rejected suggestions that GDF had a commercial interest in rejecting unbundling. "If we want to keep the ownership of the network, it is because our main industrial assets are our network. We have little upstream assets."

However, he explained, "if our shareholders in the future wish at the same time to have transport and production, we want to keep that choice".

GDF recently confirmed a deal to merge with French utility Suez, creating the world's third-largest energy company and Europe's biggest purchaser and supplier of natural gas (EurActiv 4/09/07).