Speak Up Energy

The European Commission has put forward detailed conditions for national champions in France and Germany to retain ownership of energy transmission assets in an attempt to strike a compromise over its controversial proposals to open up gas and electricity markets. In a set of amendments circulated in late April, the Commission specifies the conditions under which it could accept the so-called ‘Third Way’ trumpeted by eight EU countries as an alternative to splitting the production and transmission businesses of large integrated energy firms.”

The Third Way needs to be strengthened in order to be acceptable,” EU Energy Commissioner Andris Piebalgs told the French Senate at a hearing on 17 April. But he declined to give deputies further details, saying the Commission would wait for a vote in the European Parliament’s industry committee on 6 May before taking a more definitive stance.Under the proposed amendments, obtained by EurActiv, former state monopolies such as E.ON in Germany and EDF in France would be allowed to retain ownership of their power grids. However, they would have to leave their management to an independent subsidiary, the transmission system operator (TSO), with “the power to independently adopt its annual investment plan and to raise money on the capital market, in particular through borrowing and capital increase”. Every year, the TSO would be required to submit a ten-year investment plan to the energy regulator at national level, based on existing supply and demand forecasts.

A veto right for EU member states?

The TSO would also have a supervisory body “in charge of taking all decisions which may have a significant impact on the value of the assets” of the vertically-integrated company.

EU member states would be allowed to appoint one member of the supervisory body with “a veto right with respect to decisions that in his view may significantly reduce the asset value of the transmission system operator”. The other members would be appointed by an independent trustee, who must not have been involved with the vertically-integrated group for at least five years prior to his appointment.

From EurActiv

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