On Monday 25 November 2002, the EU Council reached agreement on the
proposed amendments to the Directive concerning common rules for
the internal market in electricity (also known as the IME
Directive). The text must now be agreed by the European Parliament.
The most significant amendments proposed are as
- Freedom of choice of supplier for all European non household
consumers by July 2004 and all customers by no later than July 2007
- Legal separation of transmission activities from those of
generation and supply by July 2004
- Legal separation of distribution activities from those of
generation and supply by July 2007.
Legal separation of transmission and distribution
into separate corporate entities from those carrying out generation
and supply would not prohibit any of these entities being part of
the same group of companies. Interesting operational issues are
raised, particularly at the distribution level.
To meet unbundling concerns voiced by France and
Germany, who were concerned at the possible bureaucratic
complexity, the EU Council has agreed that the European Commission
should submit a report to the EU Council and the European
Parliament in 2006, giving an account of the experience acquired in
implementing the Directive as well as the independence of network
operators in integrated companies. Alternative measures may then be
considered on unbundling.
In general, the agreement, subject to European
Parliament approval, of the amending Directive is an important step
in the progress of creating an integrated electricity market, and
will give rise to a number of issues in Member States. It has also
achieved a timeline which is more ambitious than may have been
thought possible given the recently expressed views of the French
and Germans, and the achievement is therefore even greater than it
at first seems.
Similar amendments are proposed to the equivalent
Further details of these proposed amendments will
be posted on Law-Now as they develop.
For further information on this topic, please
contact Robert Lane at firstname.lastname@example.org or on +44 (0)20