MEPs set to approve gas market deal

Date: 11/12/1997

By Chris Johnstone

FEARS that MEPs might challenge this week's compromise agreement to open up Europe's gas markets to competition are receding.

Members of the European Parliament had warned before the deal was struck that they might vote against the package if it did not go far enough. But even though the final deal fixed upon a slower and less ambitious liberalisation than first expected, most MEPs appear satisfied with the outcome.

EU energy ministers unanimously agreed on an initial 20&percent; opening of national gas markets, rising to 33&percent; after ten years. The UK and Germany had been pushing for a higher target, but were constrained by the need to bring a reluctant France on board.

The European Parliament must now have its say on the compromise and could block it if it were not satisfied.

However, that appears unlikely following a meeting this week between MEPs on the Parliament's energy committee and Commissioner Christos Papoutsis, after the landmark gas deal was sealed.

“Most people were satisfied. I expect the agreement will be generally accepted, though that does not mean there will not be any amendments,” said Dutch Christian Democrat MEP Wim G van Velzen.

The example of electricity, where the initial target of 23&percent; market opening looks set to be far exceeded, with a number of countries such as the UK, Germany and Finland proceeding with a full liberalisation of their markets, has helped to smooth the path for gas.

The unanimous backing of national ministers for the gas compromise also makes it politically difficult to challenge.

However, Van Velzen said that the role of the European Commission in vetting the continuation of long-term 'take- or-pay' contracts, which tie gas distributors to taking supplies at fixed prices over long periods; the separation of gas company accounts; and procedures to ease gas transportation were areas where the Parliament might table amendments.