Strasbourg, 18/06/2008 (Agence Europe) - Despite the compromise at the Energy Council on 6 June (EUROPE 9677-78), the European Parliament gave its support in a first reading (Wednesday 18 June) in Strasbourg, to a single option to effectively unbundle electricity operators' production and supply activities from activities linked to transport and network (ownership unbundling). The EP is therefore supporting the dismantling of vertically integrated companies in the electricity market, such as the French EDF company and the German RWE, which, through this option, would be compelled to sell off their high tension lines. 449 votes in favour, 204 against, with 19 abstentions, the report by Eluned Morgan (PES, United Kingdom) on the draft directive for amending the 2003/54/EC directive on common rules for the electricity market has now been adopted. It puts the EP in a strong position with the Council before the second reading. The Council is extending the possibility of an alternative option to ownership unbundling for the electricity sector. This consists of the independent transmission operator option that enables countries that still have integrated countries to avoid unbundling.
Bitter negotiations in view of 2nd reading. Ms Morgan was delighted with this victory for consumers who pay too much for electricity. After the vote she informed the press that they were ready to talk with the Council but would not be adopting a meek position. The EP says that the same company is not authorised to exercise direct or indirect control on a producer or supplier of electricity as well as an electricity ITO. A position that is in line with the initial proposal of the European Commission which sees directive 2003/54/EC as imposing legal unbundling of integrated companies' activities but which has not broken the monopolies or stimulated competition. Although Ms Morgan is determined to define a single model in the electricity sector for all member states, so that European consumers are treated equally and a regulatory framework is guaranteed for investments, Alejo Vidal Quadras (EPP-ED, Spain) was more ready to accept an alternative model for this sector (ITO in this case) provided that it guaranteed the effective independence of the electricity ITO and that three conditions are respected: non-discrimination for network access, investment independence and consumer protection. He said that they were not being dogmatic and stressed that ownership unbundling was not a panacea but a necessary and sufficient condition. Elaborated by the Slovenian presidency and the Commission, on the basis of the third way, proposed by eight member states led by Germany and France (as well as other opponents of ownership unbundling), the ITO model has been conceived to ensure respect for these three conditions.
Consumer protection measures. The Morgan report also strengthens provisions in the electricity directive that aim to ensure greater consumer protection and guarantee them rights which national regulators can ensure through enhanced powers: the right to end a contract with their electricity provider without cost; right to compensation if the quality of service does not meet certain criteria; access to information on their rights in their bills and provider website; access to information on litigation procedures; right to change provider in two week period; right to be informed at least each quarterly about their actual consumption and cost; access to intelligent counters in the ten years after entry into force of the text; right to obtain electricity from provider of their choice independent of the state where this is certified; access to information about environmental impact from supplier's electricity production; right to protection faced with market abuses (via, for example, tariff platforms imposed for limited periods defined by the national authorities on non-competitive markets). While respecting the subsidiarity principle, the EP can protect vulnerable energy consumer by calling on member states to take appropriate measures to guarantee the number of energy deprive people diminishes in real terms.
For strong and independent system. By adopting the report of Alejo Vidal Quadras on the draft regulation amending regulation 1228/2005 on network access conditions for cross border trading in electricity and that of Giles Chichester (EPP-ED, United Kingdom) on the draft regulation to set up an Energy Regulators Cooperation Agency (575 votes for, 34 against, with 36 abstentions for the first, 580 votes for, 40 against, with 48 abstentions for the second) the EP sought to provide the agency with strong regulatory powers on cross border questions and set up a European Network of Electricity Transport Managers to reinforce cooperation between the latter and harmonise market rules and technical rules, particularly in the event of blackouts. (E.H.)