ABB rejects EU proposal on energy regulator tasks

FRANKFURT - Swiss engineering group ABB recently rejected European Commission proposals to give national energy regulators powers to intervene in the spending plans of power network companies.

ABB, which provides energy industry equipment, said the Commission should rather ensure that electricity grid firms are offered the right economic incentives to invest in networks, which is strongly needed.

"I don't think it is a good idea to tell companies what and where to invest if it is not profitable," said Joachim Schneider, management board member at ABB's German unit ABB AG.

"It would be better if regulators gave the right incentives," he told Reuters at the sidelines of an industry conference. An energy market regulator, which in Germany takes up his work next summer, should allow network firms to demand high enough fees from companies aiming to ship power on their grids, he said.

This way grid firms could generate enough money to renew and add electricity networks, said Schneider. The Commission said in a draft paper seen by Reuters and due to be presented this week that network investment is needed to cope with additional demand without European citizens and businesses falling victim to frequent interruptions to supply or blackouts. The proposals follow a string of blackouts this year in North America, Italy, Scandinavia and Britain, which have catapulted security of supply to the top of the energy agenda and raised questions about the stability of Europe's liberalising market.

The Commission is expected to propose giving regulators the right to invite rival bidders to complete projects that do not look like being completed by the firms that started them. Germany has four transmission network operators: E.ON , RWE , EnBW and Vattenfall Europe.

Reuters