Watchdog demands energy merger sell-offs

10th March 2006, Comments 0 comments

10 March 2006, BRUSSELS — The Belgian energy regulator CREG has demanded French firm Suez offload its interest in gas merchant Distrigas and the network administrators Fluxys and Elia if its merger with Gaz de France (GdF) goes ahead.

10 March 2006

BRUSSELS — The Belgian energy regulator CREG has demanded French firm Suez offload its interest in gas merchant Distrigas and the network administrators Fluxys and Elia if its merger with Gaz de France (GdF) goes ahead.

CREG is also demanding that the combined business sell its stake in electricity producer SPE and the Belgian nuclear power plants to dismantle its monopolistic position in the Belgian energy market.

The strict demands are outlined in advice given to Energy Minister Marc Verwilghen, newspaper 'De Tijd' reported on Friday.

The recently announced merger of Suez — which owns Belgian electricity company Electrabel — and GdF threatens the fragile competition in the Belgian gas and electricity market.

CREG said in its report that the merger must therefore go hand-in-hand with various guiding measures. Minister Verwilghen had requested CREG to draw up its report just 10 days ago.

The merger would strengthen the dominant position of Electrabel via the interest GdF has in electricity producer SPE. CREG has thus advised that GdF should sell its stake in SPE.

However, the French merger would also bring the two biggest Belgian gas suppliers under the one roof: Suez subsidiary Distrigas and GdF. Suez must therefore sell Distrigas or transfer some of its supply contracts to other firms.

Of note is also the demand that some of the nation's nuclear power plants must be sold to other, reliable market players. The fact that the French state will be the biggest shareholder of the merged Suez-GdF firm has raised CREG concerns.

CREG said there is no other country in which a foreign government has the chance to gain control of its nuclear power plants. It therefore urged the Belgian government to ensure that Electrabel sells some of its nuclear power plants.

Meanwhile, Prime Minister Guy Verhofstadt and Minister Verwilghen met with Suez and GdF company executives on Thursday night, in what was described as a "very constructive" meeting. More meetings are expected.

[Copyright Expatica News 2006]

Subject: Belgian news

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