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Commission hails three-way electricity-market integration

Feb 16, 2007 euractive.com

Energy Commissioner Andris Piebalgs has welcomed the move by France, Belgium and the Netherlands as the first step towards European-wide integration of electricity markets, as member states struggle to agree on common energy policy.

Brief News:

The trilateral coupling has been in place since 21 November 2006 and has facilitated the creation of a new Belgian power exchange, Belpex, set up in co-operation with the Dutch power exchange APX, French Powernext, and the three transmission system operators: EDF-RTE, Elia and Tennet.

The coupling of electricity markets means that in effect, respective transmission system operators, power exchanges, and regulators work together, enabling them to use power exchanges.

The Commission believes that a single European electricity market will make better use of surplus electricity capacity and resources, bring economies of scale and lower prices. So far, the Commission reports that the trilateral coupling has led to significantly more efficient interconnections and a convergence in price levels.

Further expansion of the market is envisaged towards the northern market, the first regional market, and then to the Iberian market. The Commission then hopes that a European wholesale market will be created, following market coupling with eastern Europe through Germany.

André Merlin, CEO of the electric grid operator RTE and president of the European Energy and Transport Forum told AFX news that collaboration is "the first example in the EU of this kind of integration", while Bert Den Ouden, CEO of Dutch exchange APX Group, said that integration with Germany would be "extremely important" as it is in "a central position and would add a third dimension".

A Europe-wide blackout on 4 November 2006, leaving 10 million without electricity, highlighted the need for increased interconnection between member states.

Sir John Mogg, the president of the Council of European Energy Regulators (CEER) said that the blackout "demonstrated the need, now more than ever, for an integrated European electricity-grid subject to proper regulatory oversight".

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