CBI welcomes EC move towards more liberal energy market
February 20th 2006 CBI deputy director general, John Cridland welcomed last week's European Commission report on the Energy Sector Inquiry – but urged swift, decisive action. "It confirms what UK business has been saying for years – continental markets are not working," he said. "We are encouraged that the Competition Commissioner has stated her willingness to use anti-trust powers and take action against market abuses.
"What we need now is timely action by the commission to address the problems it has identified. These include the lack of transparency on access to networks, transit capacity across countries and gas storage, as well as restricted access to monopoly infrastructure across Europe."
Member of the European Commission in charge of Competition Policy Neelie Kroes confirmed the key problems were:
- The high degree of market concentration
- Vertical foreclosure – new entrants are 'frozen out' by incumbents who, vertically integrated, act at several levels of the supply chain, demonstrating little interest in trading with new entrants
- Lack of market integration – markets are largely national with dominant incumbents largely uninterested in competing on neighbouring territories
- Lack of transparency – there is a complete lack of timely and reliable information for both competitors and consumers. Not just a barrier to entry, this undermines trading confidence and prevents consumers from making informed choices
- Price formation – while there are several causes, one may be anti-competitive practice
Kroes said regulations would be tightened, directives amended – and that violators would be tackled. "You can take this as a word of warning if you like," she said. "We are only just at the beginning of a period of more intensive antitrust enforcement. I can only encourage everyone to take a close look at their practices." More articles from IPE News Desk: | 
