Germany irritated by Brussels' energy drive.

Germany has reacted angrily to comments by European Commission president Jose Manuel Barroso that he wants to crack down on energy monopolies.

"We are surprised by this rushing ahead by the highest level [in Brussels]," energy state secretary Joachim Wuermeling told FT Deutschland.

"We are in consultation with the commission. It is too early for final opinions," he continued.

The comments are in reaction to statements by Mr Barroso on Tuesday that Brussels is considering new laws to open competition in the energy sector.

"In energy terms I can tell you that I am more convinced than ever that we need new legislation concerning regulation," he told the Financial Times.

"What we know is that the status quo isn't working," he said. "What we have to do is decide how we can most effectively reform the system to the benefit of business and consumers."

The commission believes competition is being hindered because energy concerns normally control both production and distribution – and is considering whether they should be split.

Mr Barroso also mentioned that the commission is considering the creation of a new pan-European energy regulator to check up on monopolies.

"We have not yet achieved a completely coherent approach between national regulators," he said.

"If you want an internal market to work in Europe in energy then you need some more muscle in terms of the regulators' effectiveness."

Brussels is currently working on an overall strategy to open up the bloc's energy sector, due to be unveiled next year – the early announcements by Mr Barroso, bringing concrete ideas already into the public domain, is the source of irritation for Berlin.

Reacting to a possible EU energy regulator, Mr Wuermeling said "We share Mr Barroso's diagnosis that the market is not working at the moment but the problems on the electricity market differ greatly at national levels. We do think decentralised control is more effective. Nobody wants a mammoth European body."


Brussels' opening of the energy regulation debate comes just as Germany and Spain appear to have put an end to the energy spat with Madrid appearing to clear the way for Germany firm E.ON to take over Spain's biggest energy concern, Endesa.

Following a bilateral meeting with Chancellor Angela Merkel on Tuesday, Spanish prime minister Jose Luis Rodriguez Zapatero said "The Spanish government wants and hopes that the solution will be satisfactory to German interests, for E.ON's interests and, above all, for Spanish consumers."

Today (13 September) is the deadline for the Spanish government to explain to the European Commission the conditions placed by Spain's National Energy Commission on the takeover deal.

Brussels has termed these conditions illegal under EU law.

[Source: By Honor Mahony, Euobserver, Brussels, 13Sep06]

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