Media Coverage

It is all very well to aim not to replace one set of irresponsible utility owners with another. But it is wrong to assume that private equity firms will be any more irresponsible than public utility owners. It is the public owners of these assets that have proved themselves irresponsible by abjectly failing to invest in key assets under their control; hence the case for unbundling in the first place. Political point-scoring at the expense of private equity fails to recognise that it is in the interest of private owners to add value to the companies under their control.

Appropriately applied minimum investment requirements can be a key part of effective market regulation, but applying them for petty political reasons threatens to undermine the goal of liberalisation by exchanging one form of protectionism, against cross-border ownership, with another, against private equity.

Perhaps Europe should rethink its prejudices about ownership of utilities and other natural monopolies.

Helen Davison,

A return to dirigiste protectionism in Brussels may now have consigned this agenda, critical to Europe’s long-term energy and economic security, to history. Energy has long been considered a strategic resource by governments. In the post-war decades, the provision of reliable and cheap energy by vertically integrated national champions fuelled Europe’s economic re-birth.
Integrating the entire energy cycle – generation, transmission and distribution – into a single management structure allowed them to internalise the interactions between these different assets that had historically proved too complex for the market-place.
Governments believed that allowing these firms to attain and enjoy monopoly privileges would near-guarantee cheap, secure energy supply.
This model no longer works...

A European think tank said new EU legislation should be introduced to monitor progress on the Lisbon Agenda, provide more measurable goals and timelines, move the European Research Area (ERA) up on the political agenda. The Stockholm Network also called for the harmonization of the European patent system.... (This article first appeared in ICT Standardising Report on 14th April 2007).