Brussels stands by plans to split up energy groups

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The Commission is preparing legislation on ‘ownership unbundling’ to separate energy generation and supply activities from network operation despite opposition from France and Germany, EU officials indicated.

EU officials outlined Commission plans to transform political commitments into hard legislation after a successful summit agreed on an action plan to set up a European energy policy earlier this month (EURACTIV 13/03/07).

Speaking on 16 March, EU officials said the separation of large integrated energy groups such as France’s EDF and Germany’s E.ON was still a priority for the Commission as it seeks to ensure fair access to energy distribution networks for companies wishing to enter new markets.

Ownership unbundling – the separation of energy groups into entities dealing with network and generation activities separately – is “the working hypothesis” of the Commission, one senior official indicated.

He added that EU leaders had given the Commission “a clear indication” of this at their summit in March and that it “doesn’t make sense” to have other options on the table at this stage.

Summit conclusions adopted unanimously by EU heads of state stress “the need for effective separation of supply and production activities from network operations (unbundling), based on independently run…network operation systems”. 

The summit also called for “further harmonisation” of the powers granted by governments to their national energy regulators and a strengthening of their independence from outside interference.

“This is why we consider ownership unbundling as the preferred solution,” one senior EU official said. He pointed out that 12 member states had already introduced legislation on ownership unbundling in electricity markets and that five had done the same for gas markets.

An impact assessment on the economic, social and environmental consequences of the proposal would be presented in the summer, officials said. The proposal will be part of a “third package” of EU legislation on energy that will also include a directive on renewables to ensure that 20% of the EU’s energy needs come from wind, solar and other green sources by 2020.

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