Germany, Luxembourg To Join European Electricity Market

Goal is to create a single energy market.

On June 5, France, Belgium and the Netherlands were joined by Germany and Luxemboug in Europe's first electricity trading market , set up to better use capacity and prevent power cuts. The electricity bourse was originally set up in 2005 to create a single market which would promote better use of daily capacity, thereby smoothing out energy overproduction and shortage problems.

Last winter blackouts across Europe demonstrated the fragility of the continent's neglected power production and transport networks. EU Energy Commissioner Andris Piebalgs responded to the blackouts by calling last November for a Europe-wide coordination of energy policies.

Lack of production capacity is a second major concern, as years of underinvestment have left weak points that, if put under any further pressure, could potentially cause a power cut across the whole of Europe.

The commission has hailed the evolution of the electricity market, which involves physically building up the network as well as forming the common market, in the hopes that it will also temper soaring prices. The Commission plans to announce proposals on the issue in September, including details of its initiative for "effective" separation of the energy production and distribution sectors.

Copyright Agence France-Presse, 2007

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