Commission fires warning shot over energy reform delays
The European Commission has moved to take action against virtually all its member states over their failure to fully comply with existing energy market legislation. The censure came on the same day that member states finally adopted a raft of new energy market reforms.
The Commission sent letters of formal notice to 25 of the 27 member states — Cyprus and Malta were exempt — over their failure to comply with “applicable” gas and electricity regulations.
Poland, Portugal, Romania and Lithuania were also accused of maintaining a system of regulated energy prices in violation of EU directives. Greece was grouped in with these four countries but unlike them, was not the focus of additional EU complaints.
The issuance of a formal notice is the first stage of a process that could ultimately see member states brought before the European Court of Justice.
Energy Commissioner Andris Piebalgs was indignant over the violations.
“In this time of economic and financial crisis, it is simply unacceptable that the European consumers and companies suffer the burden of an ill-functioning energy market. The Commission is determined to take all necessary action to ensure that European consumers can benefit from real choice, better prices, and enhanced security of supply that only an open and competitive market can provide,” he said in a statement issued on Thursday.
Key violations identified by the Commission include:
Lack of information provided by electricity and gas transmission system operators (TSOs), obstructing effective access of supply companies to networks
Inadequacy of network capacity allocation systems to optimise network use for electricity and gas transmission in member states
Lack of coordination and cooperation across borders by electricity TSOs and national authorities
Inadequate efforts by gas TSOs to make maximum capacity available to optimise opportunities for market entrance and competition
Lack of effective enforcement action by the competent authorities within member states in case of violations of the EU regulations
Absence of adequate dispute settlement procedures for consumers at national level
A fortunate coincidence
The violations relate to provisions contained within the EU’s so-called second package of energy market reforms agreed in 2003. The Commission’s censure of member states is all the more pertinent given the latter adopted on Thursday a whole new set of reforms as part of the third energy package passed in April (see EDEM/ESGM 22 April 2009)
“It is a fortunate coincidence that the letter of notice was issued on the same day the third package was adopted,” an Europeab Commission spokesman told ICIS Heren on Thursday. “The implementation of the second package is important to the success of the third package,” he added.
The third energy package includes provisions for the unbundling of the supply from transmission activities of integrated companies, measures to improve transparency in the EU’s gas and power wholesale trading markets and the establishment of an EU energy regulator
The new directives will come into force 20 days after their publication in August within the official journal of the EU. Member states must incorporate the new provisions into domestic legislation within 18 months. The unbundling provisions are the sole exception, with members states allowed 30 months for implementation.
The Commission has made the completion of the internal market of electricity and gas one of the priority areas of its strategy for sustainable, competitive and secure energy.
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