Thursday, September 6, 2007

GDF-Suez merger deals a blow to EU ambition to open energy sector

The European Union's ambitions to open the bloc's energy sector to greater competition were dealt a fresh blow Monday after the French state-owned natural gas company Gaz de France announced that it would merge with the utility Suez to create one of the world's largest energy groups.

The deal, which creates Europe's largest buyer and seller of natural gas, as well as its biggest natural gas distributor, reinforces France's position as a major player in European and global energy markets. But it also runs directly counter to the centerpiece of proposals by the European Commission to break up control of the production, transportation and distribution of energy, analysts cautioned.

"The Gaz de France and Suez deal shows that the commission's plans to really open the internal market to competition in the energy sector is going nowhere." said Christian Egenhofer, energy analyst at the Center for European Policy Studies, a research group in Brussels. "Nor does it have a proper energy policy."

"This deal leads to more market power concentration," he added....MORE from the International Herald Tribune