Electricity trade in Europe. Review of the economic and regulatory challenges

Abstract:

The cross-border ownership of power generation utilities is a symptom of the increasing liberalisation of the power market. This book seeks to show how a competition-friendly and liberal environment for electricity trade could assist improved market integration, economic efficiency, supply security and environmental health.

The book is organised in two parts. Part one deals with the operational and economic elements and opens with a review of existing market structures and the constraints on liberalisation of the European power markets. Chapter two addresses the existing and planned UCTE power interconnections. The third chapter looks at the efforts to include the CIS and Mediterranean countries in cross-border interconnections but also observes that Western Europe needs to work more on the operation of its internal market first. Chapter four explores the issue of adequate investment and pricing levels sufficient to sustain that investment, and regulations to ensure power supply security. Chapter five closes the first part with discussion on the growth of electricity transmission operator groupings and associations.

The second part addresses the regulatory aspects, opening with a chapter on the most prevalent regulatory measures affecting cross-border trade in electricity. Chapter seven explores the progress with regulatory reforms in the transition economies and the end-user regulation. The legal framework governing energy trade and access to networks and the political context are examined in chapter eight. Third party access (TPA) and the effective allocation of scarce capacity are the focus of chapter nine. Analysis of the possible application of GATT and GATS to the electricity sector and the relationship between trade liberalisation and competition and environmental policies are explored in chapter ten. The following chapter looks at legislation restricting imports of electricity and the issue of nuclear power plant safety. The final chapter deals with renewable sources of energy and governmental measures to promote renewable energy.

The work will interest students, scholars, researchers policy makers, operators and regulators engaged in the power generation sector.

Janusz Bielecki is Senior Expert at the Energy Charter Secretariat in Brussels. Melaku Geboye Desta is a lecturer in international economic law at the Centre for Energy, Petroleum and Mineral Law and Policy (CEPMLP) at the University of Dundee, Scotland.