There is no need for Essent to unbundle

On Tuesday 14 November 2006, the Dutch Government and the Upper House of the Dutch Parliament joined on a broadly supported motion on the proposed amendments of the Electricity and Gas Acts. These were aimed at restructuring the Dutch energy sector. The outcome is that there is no need for Essent to unbundle.

There is no need for Essent to unbundle

Essent regards this as a sensible decision. It has consistently argued that the unbundling of ownership of grid operations and free market energy activities would place Essent at a significant disadvantage to its competitors in neighbouring countries. These competitors were not required to unbundle and therefore retained all the advantages of a large, integrated energy company. 

The Upper House of the Dutch Parliament has recognised that such a decision would give rise to an unlevel playing field in the European energy market. The House intends to vote on adoption of the unbundling act next week and on the motion, which proposes that the actual split-up of ownership is suspended until such time as that a uniform policy has been adopted throughout the EU on this issue. 

If, however, energy supply or the independence of the grid management is endangered by actions of the integrated energy companies, the provisions relating to ownership unbundling still might become effective upon consultation of both Chambers of Parliament. 

It was agreed on Tuesday 14 November that the management of the high-voltage networks of 110 kV and higher should be transferred to the transportation system operator Tennet. 

Essent will analyse the impact of the motion on the draft legislation. Further statements will follow when this analyse has been completed.  

Published: 15 November 2006