Achieving a genuine internal energy market is a priority goal for the European Union. The internal energy market is made up of the European gas and electricity markets. It has been the subject of several successive sets of directives and regulations, grouped into “legislative packages”. There have been three such packages up to now, put together by the European Parliament and the European Union Council, which establish common rules for the internal energy market for all Member States.
In 2007, the European Commission drew up an assessment report on the internal market based on a sector-specific survey of the gas and electricity markets. It concluded that there were still numerous deficiencies preventing both consumers and the industry from fully reaping the benefits of open national markets.
The Commission then announced that a 3rd legislative package would be introduced to reinforce the rules so far adopted.
The aim of 3rd Energy Package which was adopted in 2009 was to make the energy market fully effective and to create a single EU gas and electricity market. This would help to keep prices as low as possible and increase standards of service and security of supply.
The most important proposal of the "3rd Energy Package" is "ownership unbundling" - separating the operation of gas pipelines and electricity networks from the business of providing gas or generating power. The purpose of ownership unbundling is to promote an open and transparent market, non-discriminatory access to networks and a level playing field. The idea is to combat cross-subsidization between generation/supply and networks, including exchange of strategic information, to ensure both undistorted competition in electricity and gas markets and sufficient investment in networks.
Therefore, in order to value the importance of the Third energy package for ensuring effective competition the principles of ownership unbundling should be precisely discussed. Thus in the first part of this paper general information about Third Energy Package will be given and brief description of principles, benefits and deficits of the ownership unbundling will be discussed in the following parts respectively. The conclusion part answers the question whether existence of the ownership unbundling, as a main part of the 3rd Energy Package is sufficient to ensure effective competition or not.
Inhaltsverzeichnis (Table of Contents)
- INTRODUCTION
- I. BRIEF INFORMATION ABOUT THE THIRD ENERGY PACKAGE
- II. OWNERSHIP UNBUNDLING
- III. BENEFITS OF OWNERSHIP UNBUNDLING
- IV. DEFICITS OF OWNERSHIP UNBUNDLING
- CONCLUSION
Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)
This paper explores the Third Energy Package implemented by the European Union, focusing on its impact on competition within the energy sector. The main objective is to analyze the effectiveness of the ownership unbundling principle, one of the core components of the package, in promoting a truly competitive energy market.
- The impact of ownership unbundling on market competition
- Benefits of ownership unbundling in the energy sector
- Potential drawbacks and deficits associated with ownership unbundling
- The effectiveness of the Third Energy Package in achieving a fully competitive energy market
- The importance of harmonized EU rules for a level playing field in the energy sector
Zusammenfassung der Kapitel (Chapter Summaries)
- Introduction: This chapter provides an overview of the European Union's pursuit of a genuine internal energy market, outlining the evolution of legislative packages aimed at achieving this goal. It highlights the deficiencies identified in earlier packages and the rationale behind the introduction of the Third Energy Package.
- I. Brief Information About the Third Energy Package: This chapter details the composition of the Third Energy Package, consisting of regulations and directives aimed at creating a single EU gas and electricity market. It elaborates on the package's objective of promoting a fully effective energy market, focusing on price stability, improved service standards, and enhanced security of supply.
- II. Ownership Unbundling: This chapter introduces the key proposal of the Third Energy Package – ownership unbundling. It explains the concept of separating the operation of gas pipelines and electricity networks from the business of providing gas or generating power. This chapter also explores the rationale behind this principle, which aims to create an open, transparent, and competitive market with equal access for all players.
- III. Benefits of Ownership Unbundling: This section delves into the advantages of ownership unbundling, emphasizing its potential to promote competition, prevent cross-subsidization, ensure non-discriminatory access to networks, and facilitate investment in network infrastructure. It underlines the goal of achieving competitive prices for consumers and a level playing field for market participants.
Schlüsselwörter (Keywords)
The key terms and concepts explored in this paper include ownership unbundling, internal energy market, competition, cross-subsidization, gas and electricity networks, vertically integrated companies, Independent System Operator (ISO), Independent Transport Operator (ITO), European Union legislation, and effective competition.
- Arbeit zitieren
- Ziya Baghirzade (Autor:in), 2014, The 3rd Energy Package. Benefits and deficits of the Ownership Unbundling, München, GRIN Verlag, https://www.grin.com/document/277555
