Unbundling Act will take effect on 1 July 2008

The Dutch energy companies should get their agendas out. The cabinet has determined the dates for the upcoming unbundling of energy companies into their network and provision components. The Unbundling Act will take effect on 1 July 2008, and unbundling will have to be implemented by 1 January 2011. The intended merger with Nuon will remain unaffected.

The cabinet approved the unbundling proposal from Minister van der Hoeven (Economic Affairs) last month. She intended to implement the unbundling sections of the Independent Network Management Act (Won) on the first if August of this year. A majority of the Lower House supported this date. The Upper House proposed to set the implementation date on 1 July 2009, which means that the so-called group prohibition will have to be complied with no later than on 31 December 2011. Van der Hoeven settled on the compromise to have the group prohibition take effect on 1 July 2008.

As a result of the transitional provisions, the currently integrated energy companies will have to comply with this prohibition within two and a half years of this date: New Year's Day 2011. 'Unbundling does not come as a surprise¿, manager Public Affairs Hans Huigen says. `We have spent many hours considering the possible consequences for Essent. We have a clear view on the issue, and have been able to prepare for the changes that will occur over the coming period.' Various colleagues from strategic and financial departments are currently examining the various scenarios. They are considering financial issues and `cross border leases¿, but also the effects on the intended merger with Nuon.

Unbundling will not affect the merger plans. Hans: 'We prefer to merge first and unbundled afterwards. This would allow us to set up a new organisation that is based on the new and unbundled situation.' According to Hans, Essent employees will notice the merger more than the upcoming unbundling. 'Many things are already separated in our organisation: we already have a 'fat' network manager. A network manager that procures services, for instance, will have to do a lot more work. Those employees currently working for Essent Networks will work for the network company after the unbundling.'

Published: 23 July 2007