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17 June 2003 - A new energy law which will open up the power and gas markets to full competition by 2007 was passed by the EU on Monday after Italy withdrew its last-minute opposition.
Italy had raised questions over the changes which it feared would lead to higher power prices and threatened to scupper the long-awaited legislation, just two weeks ahead of taking over the EU presidency by rotation.
The law had been expected to be passed by the meeting of foreign ministers without discussion. And although Italy had no veto power over the law, which the other EU states could have voted through, Rome could have forced energy ministers to reconvene to vote on it.
Italy was concerned that rules on pricing cross-border sales of electricity would have pushed up power prices for its consumers. "The auctions will send prices higher, which means liberalisation will fail in its goal to reduce prices and improve services," said Stefano Parisi, director general of businesses' group Confindustria last week.
The final version of the law was negotiated between the Greek EU presidency and the European Parliament which approved it earlier this month. Instead of blocking the law, Italy made a formal declaration in which it said it would try to avoid price rises.
"The Italian delegation recommends...to find solutions that avoid possible price increases on final users," the statement said, according to an EU official.
The energy bill will complete the liberalisation of the EU's energy market, which has been gradually happening since the 1990s. By July next year all companies in the bloc should be able to shop around for the best deal of electricity and gas.
By 2007 the same right would be extended to all customers, breaking monopolies utilities still enjoy in some countries.
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