1. Last exit to get European Energy markets right contribution to IFIEC annual meeting, Feb 06 Claude Turmes, MEP

2. The actual mechanisms in the EU energy and gas market is not less than the biggest ever transfer of economic value from the broader public and business to the benefit of a happy few

3. Problems in the EU electricity market. Market dominance instead of competitive behaviour. Free CO2 allocations fully priced. Market imperfection (marginal cost price signal from power exchanges do not reflect real cost structure). Base-load power stations not rightly priced. National CO2 Allocation Plans manipulated. Gas market not functioning

4. Competition?

8. CO2 allowances and electricity prices Source: WVM 2005

9. wind fall profits EnBW; EON, RWE, Vattenfall Europe EDFSum 2005 Nuclear2,25,07,2 Lignite1,0- 2006 Nuclear3,08,011,0 Lignite2,0- Sum8,213,021,2

10. EU emissions trading scheme Streamlining of NAPs is crucial Allocation to new entrants in NAP-1 (w/o transfer rule)

11. Solutions: 1) windfall profit tax on electricity companies redistributed to -favour new entrance (indu cogen) -finance „electricity savings in a hurry“ -selective tax cuts to customers most hurt -…

12. Solutions: 2) brake up dominance of electricity oligopolies by stringent mesures:. electricity and gas release programs. strict merger control (abolish 2/3 rule). third directive ( ownership unbundling, access gas storage, harmonisation of powers regulators, divestment obligations)

13. Solutions 3) for big indu consumers: - EU trading platform for big energy consumers (ex. baseload Gas and Elec for 5 years duration with upfront payment to enter, dominating players excluded, ) - put an end to „national indu protection agreements“ (Spain, Italy, France,…)

14. strengthen the ETS: 1)ETS 2008 -2012 -auctioning maximum -no technology and fuel specific benchmarks –ETS post 2012 -target 2020 for CO2 -European not national scheme

15. Recent Emission Trends Global

16. competition of big European industry is not THE only problem the real BIG problems are: - halt climate change - get out of oil - get out of nuclear

17. LET‘s join forces