By Anne-France White - 6th June 2007
The EU’s energy ministers have rejected proposals to break up big energy companies.
At a council meeting on 6 June, France and Germany led a majority of countries opposing the European commission’s plans for “ownership unbundling” – a break-up of energy companies that both generate power and own supply grids.
The radical plan is advocated by EU energy commissioner Andris Piebalgs, who says tough new legislation is required in order to loosen the grip of traditional suppliers on national markets.
The commission says breaking up large companies – which often have a monopoly on their national market – would open the field to newer companies, boosting competition and driving down prices.
But the proposal, which is backed by the UK, the Netherlands and Ireland, has faced staunch opposition from major companies like Germany’s Eon and French monopoly EDF.
Piebalgs said after the meeting that he faced a “very, very uneasy situation” in his efforts to get the legislation adopted.
“It is definitely a huge challenge. The positions have been very clear,” he said.
While the EU’s ministers agreed in March to shake up Europe’s electricity and gas sectors, the 6 June council meeting made it clear the strong opposition to breaking up large energy companies.
The commission is now expected to table a watered-down proposal suggesting that big groups maintain ownership of their grids but let independent groups control the infrastructure.
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