Eon’s announcement last week to sell its grid was a massive blow in the face of the German government. Now German consumer groups and SPD MPs demand that “the state” should buy Eon’s grid in order to avoid Gazprom and alikes to buy themselves into the German market.

I think that the EU should float a massive investment vehicle together with the EIB and take over the energy grid inside the EU step-by-step. Then a European regulator could put fair prices and oversee sustainable investment into the grid. Such an approach of creating European public goods besides modern developments (e.g. Galileo) would best fit where the EU has its policy competences in any case. – It is clear that energy will remain as one of the core challenges over years to come and the Commission can create free and fair market conditions only if it gains direct access on regulation and investment. – In addition to breaking the European oligopoly market (= better prices for industry and consuemers) this should be of additional help to less well-off member states who can expect a serious investment in their grid infrastructure thanks to EU and EIB funds.

Now such a project would be a bold step for a bold Commission!


Comments

2 Comments so far

  1. Giacomo on March 3, 2008 19:08

    I think States in general must do few things but very well done, and so I do not say no to privatizing.

    However I have to admit that the idea tha some pieces of European energy could be sell to Gazprom make me feeling not too much confortable.

    The problem is that if i privatize an industry and a such important one as energy one, then I cannot sell it to a foreign corporation that is controlled by a foreign State, often not so friendly (they recently talked about poiting nuclear heads toward us…), and a State that use that corporation for backing its own foreign policy.

    So there is a too strong asimmetry and it is better not to leave them buying pieces of Europe.

    Anyway there is one thing which is vital. Many years of State built industries in Italy brought to an extremily radicated corruption.

    The only way to avoid this to happen also with Europe is to have a very strong Eurojust and Europool. The two things must go togheter and we cannot assume States can do this alone: let’s have a look to the bilions of euros of structural funds stolen in the South of Italy during the decades without producing any actual economical development (this obviously is not a reason against these kind of finaning tout court, it’s enough to cite Iraland to see what a clever people can do).

    If the money belong to all Europeans there must be an European police and judiciary to guard them.

  2. James Rogers on March 4, 2008 19:26

    I agree, absolutely. The energy grid should be under European Union control. It is a precious piece of strategic infrastructure and keeping sovereignty over it is essential for European security and prosperity. Allowing the likes of Russia to buy more European energy infrastructure is extremely dangerous and would make us increasingly dependent on the Kremlin’s whims and fancies.

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