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Home > Journal

Editorial, Volume IV, issue #02 - August 2006

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Article from: OGEL 2 (2006), in Editorial

Introduction

When the lights go out in a major city, such as New York, Rome, London, or Tokyo, the result is a major inconvenience followed by an investigation to find out why the power failure occurred and what should be done to prevent such events in the future. If this were simply a problem caused by the local distribution company, it would be easy to find the solution. Today, however, the security of electricity supply depends on the stability of power systems far away. For example, the blackout in Rome in 2003 was related to an interconnector between Italy and Switzerland. Interconnectors have become an essential part of the power system, and the issue of energy security.

Where electricity markets are not liberalized, it is a fairly simple matter to identify the power company which has a public service obligation to build enough interconnectors and enough generating stations to supply its customers. In a liberalized market the responsibility for building interconnector capacity and generating capacity is shared by many companies and regulatory authorities and it is much less clear who is responsible. But surely the issue is too important to ignore. The legal and regulatory framework for the power sector should take care of this question.

In this special issue of OGEL, we have put together a collection of articles about electric interconnectors, with a special focus on the legal and regulatory framework and the incentives to build new interconnector capacity. The main focus of these articles is on European experience, for two reasons. First, the European electricity market is the largest and most sophisticated international electricity market. Second, the European Electricity Directive requires a very high degree of market liberalization and a high degree of cross-border electricity trade. Third, there is a high level of transparency of information with regard to cross-border electricity trade in most regions within Europe. For these reasons, interconnectors in Europe are particularly interesting.

Interconnectors present serious challenges for both the Community legislator and the enforcer: attracting investment, freeing interconnectors from various encumbrances, securing the supply of energy and creating opportunities for market based competition.

This special issue will also approach these questions from a wider setting and discuss issues such as international energy trade and access to networks or disputes arising from the operation of interconnectors.

Similar issues will no doubt be discussed in the thirteenth meeting of the European Electricity Regulatory Forum in Florence on September 7 and 8, 2006. This special issue of OGEL will serve those who wish to get a complete picture of various issues relating to interconnectors. It will also provide for alternative ways of looking at the problem areas Europe is presently facing.

Kim Talus and Charles Zimmermann

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Suggested Citation

"Editorial, Volume IV, issue #02 - August 2006"
OGEL 2 (2006), www.ogel.org

URL: www.ogel.org/article.asp?key=2196

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