Germany has dropped its opposition to European Commission proposals to liberalise the energy market, increasing the likelihood of a compromise at a European summit in March. Michael Glos, the economics minister, told the Financial Times that Berlin "would not rule out any option", including stripping energy producers of their distribution networks and the creation of a powerful European regulator. The German U-turn would leave France isolated in its opposition to measures that could see companies such as EdF of France and Eon and RWE of Germany broken up to promote competition. As holder of the European Union's six-month presidency, Berlin must engineer an agreement between the 27 member states on a joint energy action plan at the summit on March 8-9. (...) The minister, a close ally of Angela Merkel, chancellor, conceded that there had been a change of mind in Berlin. "We used to defend the line that national regulators are all we need but we must admit this is not sufficient . . . We do not have enough competition in the German market." Mr Glos is taking the side of German energy users, both industrial and domestic, against energy producers and the national regulator. The change of mind also reflects rising concern about the vulnerability of Europe's energy supplies.
Michael Glos, the economics minister, told the Financial Times that Berlin "would not rule out any option", including stripping energy producers of their distribution networks and the creation of a powerful European regulator.
The German U-turn would leave France isolated in its opposition to measures that could see companies such as EdF of France and Eon and RWE of Germany broken up to promote competition.
As holder of the European Union's six-month presidency, Berlin must engineer an agreement between the 27 member states on a joint energy action plan at the summit on March 8-9.
(...)
The minister, a close ally of Angela Merkel, chancellor, conceded that there had been a change of mind in Berlin. "We used to defend the line that national regulators are all we need but we must admit this is not sufficient . . . We do not have enough competition in the German market."
Mr Glos is taking the side of German energy users, both industrial and domestic, against energy producers and the national regulator. The change of mind also reflects rising concern about the vulnerability of Europe's energy supplies.
I'm not sure how much of this is political jockeying (both by the FT and by Glos), but I cannot tell you how much I am sick of seeing that argument conflating the "side of energy users" and security of supply, and sicker of seeing this liberalisation (which brings us MORE GAS-FIRED PLANTS) associated with the same.
Security (of supply like any other kind) has a cost, that has to be paid by someone.
But I note that energy producers are now the enemy. Ahhh... the Enron model still has a vivid hold on our deciders' imagination. In the long run, we're all dead. John Maynard Keynes
He said he hoped those concerns would fuel a broad debate on the wisdom of phasing out nuclear energy over the next 15 years, as decided by the previous government. Although Ms Merkel favours nuclear energy, her Social Democratic coalition partner wants to stick to the phase-out plan. "The Commission's ambitious CO2 emission targets cannot be reached without nuclear energy because renewable energy cannot be rolled out sufficiently swiftly," Mr Glos said. "This raises a number of questions, which those who fight an ideological battle against nuclear energy must answer . . . " Nuclear energy provides 25 per cent of Germany's electricity, a capacity that critics of the phase-out plan argue will have to be filled by highly polluting coal and lignite power plants. Instead of cutting its CO2 emissions, as the government has pledged, Germany would thus see them rise by 8 per cent between 2000 and 2020, according to economic ministry calculations.
"The Commission's ambitious CO2 emission targets cannot be reached without nuclear energy because renewable energy cannot be rolled out sufficiently swiftly," Mr Glos said. "This raises a number of questions, which those who fight an ideological battle against nuclear energy must answer . . . "
Nuclear energy provides 25 per cent of Germany's electricity, a capacity that critics of the phase-out plan argue will have to be filled by highly polluting coal and lignite power plants. Instead of cutting its CO2 emissions, as the government has pledged, Germany would thus see them rise by 8 per cent between 2000 and 2020, according to economic ministry calculations.
I agree with him on the substance of the above, but worry about what kind of political trade off which would encourage more liberalisation (together with more subsidies for nuclear, I'd expect) could be in the cards.
Unbundle the network, and we give you some nuclear to play with. That would work with RWE and E.On, but would not do much for EDF. In the long run, we're all dead. John Maynard Keynes
