1. Regional energy markets – a diversion from the real solutions ?
Claude Turmes, MEP
Vice President of the Green/EFA group in the European Parliament
Regional energy markets – a diversion from the real solutions ?
28/3/2007

2. Competition?

3. EU energy market problems
Transmission grids not „neutralised“
Huge market concentrations in electricity and gas sectors and between el&gas
„Access to finances“ distortions between
different players (decom funds&grid ownership)
Market distortions through non-internalisation of externalities (coal, nuclear versus renewables)
Missing market integration

4. Competition on German market
RWE & E.on = 60% of power generation
E.on = 60% of gas
„Due to relevant structural factors in the market and competition as it stands, there is no competition between E.on and RWE within Germany“ (FCO in „Saarferngas“ ruling, February 2007)

5. Power generation market concentration in a (future) fully integrated Market of France, Belgium, The Netherlands, Luxembourg, and Germany,
Note Power production was consolidated if a generator owns more than on third of the shares of another generator
Source Öko-Institut calculations

6. True& fair competition through new EU&national legislation
Ownership unbundling
For the transmission level on el&gas
Not for distribution level
De-minimis stays at connected clients
De-concentration of the el&gas market
Stronger tools for regulators (El&gas release programs)
Limitations for new invest of dominating players !
Stimulate new entrance in gas, renew&CHP
Segregated decommissioning funds
Full internalisation of external costs
ETS with full auctionning after 2012
Polluter pays in for the nuclear sector (decom funds, liabilities)

7. Weaknesses of a focus on „Regional energy markets“
Institutional „vacuum“ between national and European level
Lack of democratic control
Not able to overcome the real stumbling blocks (concentration, distorsion)
Possible „escape door“ for the needed tougher regulations (ownership unbundling, de-concentration strategies)

8. Thank you for your attention! For further information

9. Stock of Old Power Plants Germany

10. Urgent to do Ownership unbundling grid – power prod.
Market deconcentration strategies
Full internalisation of external costs
Favour new entrants (eff + renew)
Independent regulators with clear political mandate
Democratic control

12. Fun(d) or no fun(d) ? Access to Nuclear Decom. fonds
E.on billions
RWE billions
Endesa
ENEL
EDF billions
Vattenfall (depends)
(Central&Eastern EU) - XX billions

13. Price signal from today NAPs