News
EU exemption win for electricity producers with OGC guidance
Released on 30/03/2006
Great Britain's electricity producing companies became the first market sector in Europe to win an exemption from EC procurement directives, thanks to their unprecedented level of collaboration on a nationwide scale and OGC's active support for the utility industry.
The exemption, which covers all power generators in England, Scotland and Wales, is the first to be granted by the European Commission for any kind of industry in all 25 member states of the European Union.
With the historic success, electricity producers in Great Britain can enjoy the benefits of deregulation in this highly competitive market.
The procurement procedures of businesses operating in the water, energy, transport and postal services sectors are regulated by the Utilities Directive 2004/17/EC, which came into force across the EU on March 31, 2004. This was enacted into English law on January 31, 2006, by SI 2006 No 6 of the Utilities Contracts Regulations 2006.
However, several new concepts were included in the directive, one of which was a new exclusion mechanism. This allows a market sector to be exempted from the application of the directive, if it can be proven that the sector is directly exposed to competition, where market access is not restricted.
The power market collaborated under the umbrella of the Association of Electricity Producers (AEP), which submitted to OGC an application on behalf of its 88 members, to exempt electricity generating companies in England, Scotland and Wales from the operation of this Utilities Procurement Directive.
OGC supported this and successfully took the case to the EC for a decision. The case was also supported by the UK's independent regulator of the utilities sector, Ofgem, as required by the directive.
The eagerly awaited outcome was announced by the EC on Friday, March 10, 2006 - a historic achievement even before the enabling process within the UK regulations actually came into force.
The AEP's chief executive, David Porter, expressed delight that the British power generation market is no longer subject to the utilities directive. He said: "We are grateful both to the Office of Government Commerce which submitted the application and to Ofgem, which lent its support."
Contact details:
OGC Service Desk
Tel: 0845 000 4999
E-mail: ServiceDesk@ogc.gsi.gov.uk
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Page last updated: 2008-10-20
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