Energy market citations hit 18 EU states

April 5, 2006
Following a Feb. 21 warning, the European Commission issued formal notices Apr. 4 citing 18 European Union member states for failure to officially and effectively implement its directives on opening gas and electricity markets or, in the case of Spain, failure to apply them properly.

Doris Leblond
OGJ Correspondent

PARIS, Apr. 5 -- Following a Feb. 21 warning, the European Commission issued formal notices Apr. 4 citing 18 European Union member states for failure to officially and effectively implement its directives on opening gas and electricity markets or, in the case of Spain, failure to apply them properly.

The letters—a "start of firm action" to remedy identified weaknesses in European markets—were sent to Austria, Belgium, the Czech Republic, Germany, Estonia, Spain, Finland, France, Greece, Ireland, Italy, Lithuania, Latvia, Poland, Sweden, Slovakia, and the UK. The commission is still investigating Hungary and Portugal.

The notifications warned that if a member state could provide no assurance that it intends to amend its energy laws, the commission would involve the European Court of Justice. It is doing so with Spain and Luxembourg, which have not yet submitted the directives to their legislative bodies.

Completion of internal gas and electricity markets is one of six priorities in the Commission's strategy, adopted last March, for "sustainable, competitive, and secure energy."

Energy Commissioner Andris Piebalgs stressed that the directives must be implemented quickly and in full, "not only in form but also in substance." The strategy, he said, will not be possible without open, competitive energy markets to enable EU companies to compete Europe-wide. In addition, differences in the ways EU members are opening their markets will hamper development of a genuinely competitive market.

The commission focused on points that guarantee competition, such as the extent to which markets are opened; the real possibility of changing suppliers; the emergence of new market entrants with nondiscriminatory access guaranteed by strong, independent regulators; and the guarantee of consumer protection.