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Glachant, Jean-Michel --- "The Making of Competitive Electricity Markets in Europe: No Single Way and No ‘Single Market’" [2003] ELECD 43; in Glachant, Jean-Michael; Finon, Dominique (eds), "Competition in European Electricity Markets" (Edward Elgar Publishing, 2003)

Book Title: Competition in European Electricity Markets

Editor(s): Glachant, Jean-Michael; Finon, Dominique

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9781843761785

Section: Chapter 1

Section Title: The Making of Competitive Electricity Markets in Europe: No Single Way and No ‘Single Market’

Author(s): Glachant, Jean-Michel

Number of pages: 32

Extract:

1. The making of competitive
electricity markets in Europe: no
single way and no `single market'
Jean-Michel Glachant

INTRODUCTION

Competitive reforms are causing an unprecedented shake-up of the
European electricity market, affecting not only the 15 countries of the
European Union (EU), but extending beyond them to nations like Norway
and Switzerland, as well as to applicants for membership in the EU
(Poland, Hungary, the Czech Republic, and so on). During the second half
of 1996, adoption of Directive 96/92 on the creation of an `internal market
for electricity' marked a turning point in energy sector liberalization poli-
cies in Europe. Previous to that, competitive reform of electricity had only
begun in a handful of countries: Great Britain and Norway in the early
1990s, and Finland and Sweden in 1995 and 1996. With the entry into force
of this directive in February 1999, and parallel movements in Norway and
Switzerland as well as in the applicants, a group of 20 countries are now
simultaneously opening their electricity sectors to competition. This incip-
ient European market represents nearly 3000 TWh in potential consump-
tion ­ almost six times that of Germany ­ with approximately 450 million
domestic consumers. What is the shape of this new competitive electricity
sector? Is there convergence towards a single model or, conversely, does a
significant diversity persist? What structural changes were catalysed by
electricity market liberalization in Europe?
In fact, five years after adoption of Directive 96/92, the European `inter-
nal market' for electricity ...