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24 August 2007 - The European Commission has not yet finalized its proposals for unbundling energy networks despite reports that the bloc will force utilities to spin off their assets, the EU energy commissioner's spokesman, Ferran Taradellas, said in Brussels.
A text on the EC's proposals for a third energy package--including its controversial recommendations for unbundling energy networks--is currently going through inter-service consultation within the Commission.
In response to questions over a report Thursday in German daily
Handelsblatt, which said it had obtained a draft copy of the proposal confirming the EC would push for ownership unbundling--forcing utilities to spin off their generation, distribution and supply assets--Taradellas told reporters: "It has not yet been finalized and the Commission will have to take a decision on September 19."
Handelsblatt also said the planned law is to introduce "strict price controls" in the power and gas markets, intends to give the regulatory authorities "considerably more power" and plans to found a "European control agency." According to the paper, "the proposal was worked out by the energy commission under Andris Piebalgs with "significant participation of competition commissioner Neelie Kroes."
Taradellas did, however, confirm Handelsblatt reports that the Commission had received letters from the German and French governments, urging the EC not to proceed with its proposals for ownership unbundling, but he added that
other member states had also lobbied hard in favor of ownership unbundling.
"There were letters from the French and German governments who want
different options for unbundling," he said. "But there were also questions
from other governments supporting ownership unbundling."
The German government has separated Germany's four major utilities--E.ON,
RWE, Vattenfall Europe and ENBW--from their grid operators in the hope that this might help to address the EC's concerns over their market dominance and lead them to adopt the softer compromise of "independent system operators" instead of full ownership unbundling.
This would allow utilities to retain their grid assets as long as they are run by an independent company.
Once published, the EC's draft of its third package of EU energy laws to tackle remaining concerns in completing the internal gas and power markets must be approved by the European Parliament and EU member state governments before it can become law.
The EC has long demanded full ownership unbundling of European power and gas markets. The UK, where markets are unbundled, is the Commission's biggest supporter in this case while Germany and France, where the big utilities are integrated, are the proposal's strongest opponents.
Due to the opposing positions of the UK on one side and France and Germany on the other, it is broadly expected that any process of unbundling would take years to come into effect.
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