Released on = April 16, 2007, 8:48 pm

Press Release Author = Bharat Book Bureau

Industry = Marketing

Press Release Summary = Executive Summary

This Market Assessment report on the European electricity industry provides an
analysis of progress towards the complete liberation of the market, which will
enable all customers to have a choice of electricity supplier.

Press Release Body =
The European Electricity Industry: Market Assessment

Executive Summary

This Market Assessment report on the European electricity industry provides an
analysis of progress towards the complete liberation of the market, which will
enable all customers to have a choice of electricity supplier. There is currently an
uneven situation, with some countries having had an open market for years and others
having experienced slow progress. However, creating the open market was made more
complex as a result of the ten new states that joined the EU in May 2004. Some of
these new members have state-controlled industries that need to be restructured to
provide the basis for a competitive electricity market.

The opening of the EU electricity market is being driven by the Electricity
Directive, which aims to open the market completely by 2007. Throughout the opening
of the market, a staged approach has been adopted. This began with very large
customers, followed by further openings for smaller customers and, finally,
liberation for the domestic market. In 2007, it is anticipated that the market will
be open to households - the final group of customers.

A country-by-country analysis of the EU electricity market - which comprises an
account of market structure, electricity demand/production/generating statistics and
profiles of major players in each country - is provided in this report. As well as
discussing key issues relating to full and fair market opening, this report examines
the competitive position held by major companies in the EU. In some countries, there
are some very powerful organisations, which can give little opportunity for the
entry of new players.

The separation of generation, transmission, distribution and supply to avoid
companies having undue influence on the supply of electricity in any specific
geographical area must be resolved before a truly competitive market can operate. In
addition, access to transmission systems across the EU are receiving attention from
the European Commission (EC).

The EU electricity industry is making greater use of gas for power generation. As
European gas production declines, the EU will become ever reliant on gas supplies
from outside the region. In future, the EU will be trading with countries with very
different politics and cultures from those operating within the EU. In a world where
terrorist activities are not uncommon, there is a risk of gas/electricity supplies
being disrupted.

There are various views regarding the future of nuclear power within the EU; some
countries have a strong policy on this, others have a non-nuclear policy and some
are unclear what its future should be.

Environmental issues are now important in the EU electricity industry, with
requirements to reduce carbon emissions. EU targets for renewable energy aim to cut
carbon emissions and reduce dependence on conventional thermal sources.

Overall, with further countries already seeking EU membership, much work needs to be
completed before a truly open, competitive and fair market will be achieved.

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