The dangers of EU electricity liberalisation

The European Union: A New Model of Governance
"An investigation in to some of the factors which pose a threat to the implementation of a successful EU wide liberalization of the electricity market",
The basis for my essay was formed by David M. Newberg's article entitled'problems of liberalising the electricity industry'.Newberg highlights the dangers of liberalisation, and points out that it could actually lead to higher prices.He draws a parallel between the European Commission's attempt to update the electricity objectives to under-write unbundling and full liberalisation, with the Californian Electricity Crisis.
Newberg cites issues such as the lack of legislative and regulatory power the EU possess in order to mitigate generator market power. He also addresses the area of transmission and transmission capacity, and the bearings they could have on successful liberalisation. I would join Newberg's stance on the grave danger which liberalisation could present if not handled in a very skilled and astute manner by the relevant authorities.In addition to Newberg's worries, I will present some additional potential obstacles the EU will confront along the route to full liberalisation. Much of the material written on this topic concentrates on the myriad of benefits which liberalization will trigger, however in my essay, I would like to highlight some of the potential stumbling blocks which we need to be aware of in relation to the EU wide liberalization of the electricity market. As I will point out, the electricity sector is a vital cog in the economic welfare of the European Union, and as such we should be aware of the dangers of liberalization.
I intend to draw on several academic articles, in conjunction with sources from the Financial times and EU web sites.
It is a relatively recent phenomenon the notion of liberalization of the electricity industry.Until recently, public u…

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