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A number of regulatory challenges exist in the design of policy frameworks that apply to both primary and secondary energy sectors. One of the most important is how to increase the scope for and effectiveness of competition in sectors where monopolies either already exist or are prone to emerge. Another is the desirability of incorporating environmental considerations into the overall market framework in which energy industries operate.

In Europe, major efforts are underway to liberalize gas and electricity markets. These should be complete by 2007. Obstacles to be overcome relate to, among other things, issues of access to networks, tarification issues and different degrees of market opening in EU Member states. The way the regulatory system deals with these will strongly influence, among other EU objectives, the degree to which efforts to combat climate change are advanced by increased use of renewable energy sources for power generation to reduce greenhouse gas emissions. GEM is currently exploring these issues in the French context with a view to analyzing the reasons for the low penetration of wind energy in the French electricity market.


Telecommunications markets are characterised by important barriers to entry, making them an area of concern for authorities charged with fostering competitive markets. In spite of extensive technological and structural changes in the telecoms industry over the last few years, monopoly powers have not disappeared. Liberalisation - the opening of formerly state dominated markets to new competitors – has created a need for independent regulatory authorities to foster competition and guard against dominance. Yet regulators must also strive to diminish the negative impacts of their policy interventions and to foster accountability.


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