Slovak and Czech energy industries face the Internal Energy Market

Energy experts from Slovakia, the Czech Republic, Hungary and Austria gathered in Bratislava on the occasion of the Slovak Energy 2004 conference to discuss the imminent challenges for the industry in Slovakia and neighbouring countries following EU accession. Representatives from the accession countries were concerned that they would be left outside the EU Internal Energy Market. Christoph Riechmann, Director in Frontier's European Energy Practice (London and Cologne), explained that the prerequisites for market integration were a formal market opening as well as the commercial availability of sufficient power transfer capabilities between the countries. He stressed that integration has also only partly been achieved in the old EU countries. Based on recent Frontier analysis on market definition investigations for countries such as Austria, Germany, Belgium and the Netherlands, Dr. Riechmann explained that countries like Germany, Austria and France experienced a comparably high degree of market integration while other, geographically close markets like the Benelux region experienced some commercial divide with their neighbours. These divisions manifest themselves in price differences between the regions. Accession countries may well experience a comparable divide due to a weaker historical interconnection with Western Europe. Nontheless, significant competitive interaction between the markets can and should be expected.