EU To Reform Energy Market Structure

The European Union has embraced proposals to reform energy markets throughout Europe, in a move designed to improve competition amongst providers for the benefit of consumer and business energy buyers.

The European Commission has today given the green light to measures which would require energy suppliers to avoid running their respective infrastructural markets, that is to say those major corporations controlling distribution channels as well as supply will no longer be able to do so within the EU.

The measures will requires those currently in monopolised infrastructural positions to either sell their infrastructure or lease it out to be controlled by other companies in order to continue to trade within Europe, hitting some of the region’s current major suppliers when they come into force.

The strict measures are designed to offer internal protection to EU energy suppliers, whilst creating a more level playing field for companies within the EU in the energy industries by eliminating the possibility of monopolising distribution networks and service sectors.

The move in particular will impact Russian giant Gazprom, which currently supplies around one quarter of European supplies from outwith the eurozone. In order to remain trading within the eurozone, Gazprom would be required by the new laws to disintegrate its pipeline network to comply.

At present, the European Commission suggests that the market structure is too accommodating of larger enterprises, which sap competition and leave many EU residents and businesses with no real choice in selecting energy providers. The new proposals are designed to create a more competitive marketplace for the benefit of end consumers throughout the Eurozone.

Market analysts are predicting that certain of the large central European providers like EON will be particularly affected by the measures, whilst it should also eventually result in a more free flow of gas and electricity throughout the eurozone region.

Story link: EU To Reform Energy Market Structure