Watchdog short-circuits power alliance

Will Swissgrid stifle competition? Keystone

Switzerland’s competition watchdog is to investigate a decision by electricity operators to form a joint company to manage the Swiss power network.

This content was published on December 23, 2004 - 10:11

The probe, which could take up to four months, wrecks January’s planned launch of the new firm, Swissgrid.

Seven of the country’s largest electricity grid operators, Atel, BKW-FMB, CKW, EGL, EOS, EWZ and NOK, want to unite to give Switzerland a single voice in dealing with cross-border energy transmission.

But the Competition Commission (Comco) said on Thursday that it wanted to examine whether the move would stifle competition.

“In a preliminary assessment the Competition Commission concluded that in some regions [of Switzerland] the [project] could lead to a market-dominating position in the electricity transmission market,” a statement said.

The commission added that an in-depth probe of the project would take up to four months.

Patrik Ducrey, vice-director of Comco, confirmed that Swissgrid would have to put its plans on hold until the investigation had been completed.

He rejected any blame for the delay, saying the watchdog had not received documents relating to the alliance until the end of last month.

For their part, the grid operators said technical preparations for the new company would continue despite the delay.

Liberalisation

The grid operators were planning to launch Swissgrid in January as part of moves to open up the country’s electricity sector in line with European Union practices.

Switzerland is not a member of the EU, but it is a pivotal hub for trading power across Europe.

The EU said in September that the creation of Swissgrid was a positive step. It said it was looking forward to dealing with a single partner responsible for the entire Swiss network.

Swiss grid firms were blamed by Italian and French energy regulators for a blackout in 2003 which affected most of Italy.

Earlier this month the Swiss government announced proposals to gradually liberalise the electricity market.

In 2002 Swiss voters rejected plans to open up the sector within six years and give industry and private consumers more choice over where they draw their power from.

swissinfo with agencies

Key facts

In 2002 Swiss voters rejected proposals to liberalise the electricity market.
In December 2004 the cabinet announced new plans to gradually open up the Swiss electricity market.
The EU wants to liberalise the electricity sector by 2007.

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