Brussels, 24/05/2007 (Agence Europe) - Questioned by Reuters in a conference on energy in Berlin, Commissioner for energy, Andris Piebalgs, affirmed that the Union wanted to reach a rapid and amicable compromise with energy operators on the question of unbundling (separation of production and network activities) to increase competition on the energy markets without forcing companies to sell their networks. He declared that, “Finding a solution in a 'nice and fast way' would avoid a years-long legal battle”.
To improve competition in the internal gas and electricity market and guarantee affordable prices for consumers, the Commission wants to compel the major energy operators to unbundled production and energy supply network management if there is need to sell off the latter.
It supports, then, a radical option - ownership unbundling which would lead to the complete break up of the groups which have both electricity or gas plants and a distribution network (such as the French operator EDF or German operators E.ON and RWE which opposed this option). In January (see EUROPE 9341), the Commission also proposed a second, much more flexible, option, called “ISO+” which would see the historic operator retain ownership of its transport infrastructure, but would hand over the running of it to an independent network manager.
This “unbundling” process is “in the opinion of the Commission the simplest, cleanest and most efficient solution,” the energy commissioner said in a speech delivered at the conference. He felt only independent network operators could guarantee that rival electricity or gas suppliers have equal access to networks and markets. “Putting energy grids into the hands of one independent operator that holds the companies' stakes without owning them would be only 'the second-best option',” he added, noting that he would bring forward concrete proposals in September or October.
Speaking to Reuters, Piebalgs gave assurances that “We'd also support another solution if utilities have a better solution how to operate networks independently”. “It's always better to not completely (work) against the will of the (energy) industry,” he added.
Sticking strictly to the compromise of the Energy Council of 15 February in which the Commission's two options were not mentioned, the European Council in March called for the separation of production and network activities on the basis of independent network management systems and regulated in an appropriate manner, to guarantee equality and freedom of access to transport infrastructure and also independence of decision-making in infrastructure investment (see EUROPE 9383).
The unbundling issue will be discussed once more at the Energy Council on 6 June. (eh)