APEx conference

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European CommissionDG Energy and Transport
APEx conference Main issues in the new EU
Directive 2003/54 and EU Regulation
1228/2003 Leipzig 11.10.2004
Cristobal Burgos AlonsoDirectorate for
Conventional energiesCristobal.Burgos-Alonso_at_cec.
eu.int
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Summary

• Path to liberalisation
• Electricity directive
• Regulation on cross-border trade of electricity
• Market design

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Path to liberalisation

• Single Market Treaty 1985
• White Paper on Energy Policy 1995
• Electricity (1996) and Gas (1998) Directives
• Lisbon summit 2000
• Amendment proposal 2001
• Political agreement at Council 2002
• Package adopted June 2003
• Implementation by 1 July 2004

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The package

• Directive 2003/54 electricity
• Directive 2003/55 gas
• Regulation 1228/03 electricity
• Most provisions effective from July 2004

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Directive 2003/54/EC

• Opening to all non-household customers July 2004
• Full market opening July 2007
• Legal unbundling of transmission by July 2004,
  distribution by July 2007
• Regulated Third Party Access
• Universal service obligation
• Duty to monitor security of supply

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Regulation 2003/1228/EC

• Basic principles for
• transmission charges (entry\exit)
• congestion management (market based and
  non-discriminatory)
• inter TSO compensation (actual flows, standard
  costing method)
• Comitology procedure to adopt detailed guidelines

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Fundamental issues

• Cross border exchanges
• Interconnection and market concentration
• Security of supply and volatile prices
• Need to deliver environmental objectives

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Regional energy markets in the EU
Moderately concentrated Highly concentrated Very
highly concentrated
congestion
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Status of congestion management
Source ETSO
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Status of congestion management in Europe

• On 25 most congested interconnectors
• 12 interconnectors are managed with market-based
  methods
• 13 with non-market based methods
• 14 interconnectors have a joint method agreed
  between the TSOs/regulators concerned
• In 11 cases
• 50-50 split of the capacity or
• capacity has to be obtained from both TSOs or
• allocation is unilateral

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Progress in LiberalisationImplementation

1 BE(f) francophone Belgium (Brussels and
Wallonia), BE(n) Flanders
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Infrastructure package

• Second communication on European infrastructure
• Directive on security of electricity supply
• Directive on energy services
• Revision of the Trans-European Energy Networks
  Guidelines to include accession countries
• Regulation on access to gas networks

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Conclusions and Way Forward

• EU has created the world biggest electricity
  market
• Implementation of the legal framework and the
  practical application of the rules are not yet
  completed
• In 2005 EU will produce a report on the
  functioning of the internal market for
  electricity and gas
• After that it will be assessed what further
  measures are needed

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Thanks for your attention

• Please visit our website
• http//europa.eu.int/comm/energy/electricity/index
  _en.htm