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Tuesday, 21 April 2009

Shake-up of gas and electricity market

The right to compensation for poor service, the right to change gas and electricity suppliers and comparable prices are just three aspects of the proposed "third energy package" being debated today by MEPs in the European Parliament in Strasbourg. The wide ranging piece of legislation has reached the second reading stage and if approved by Members in a vote Wednesday needs to be endorsed by national governments.

At the heart of the proposals is the concept of "unbundling" - separating the operation of gas pipelines and electricity networks from the business of providing gas or generating power.

Large State utilities would not be able to generate and supply energy.

This would mean for example that integrated companies such as Électricité de France would not be able to generate power and own the grid. Its supporters claim it would also allow smaller companies into the market, offer more choice to consumers and boost renewable energy.

For the consumer the shake-up in the market also entails receiving all the relevant data about how much gas or electricity they use and information on bills and what rights they have as consumers. The creation of an energy Ombudsman or consumer council is also envisaged.

More independence for national regulators planned

The 3rd energy package also foresees the establishment of an EU Agency for the cooperation of Energy Regulators and the establishment of European Networks of Transmission System Operators for electricity (ENTSOE) and gas (ENTSOG) to implement the changes.

Improving regional cooperation and making national regulators more independent is also part of the plan.

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