EU 3rd energy package

The European Union's Third Energy Package is a legislative package for an internal gas and electricity market in the European Union. Its purpose is to further open up the gas and electricity markets in the European Union. The package was proposed by the European Commission in September 2007, and adopted by the European Parliament and the Council of the European Union in July 2009. It entered into force on 3 September 2009.

Core elements of the third package include ownership unbundling, which stipulates the separation of companies' generation and sale operations from their transmission networks, and the establishment of a National regulatory authority (NRA) for each Member State, and the Agency for the Cooperation of Energy Regulators which provides a forum for NRAs to work together.

The European Commission and the Parliament wants to reach the goals of “Europe 2020 Strategy” through a secure, competitive and sustainable supply of energy to the economy and the society. The correct transposition of the European electricity and gas legislation in all Member States is still not complete. Because of this, the Third Internal Energy Market Package was adopted in 2009 to accelerate investments in energy infrastructure to enhance cross border trade and access to diversified sources of energy. There is still a market concentration on the energy market in the European Union, where a small number of companies control a large part of the market. Together, the three biggest generators of each country hold more than two thirds of the total generating capacity of 840,000 MW. The EU advises three options to weaken the market power of the biggest electricity firms: ownership unbundling, independent system operator (ISO) and independent transmission operators (ITO).

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