Outlook: Power struggle leaves a nasty smell

PERHAPS IT was too much to expect consecutive victories over the Germans and the French in the same week. On Tuesday Gerhard Schroder came to his senses and decided it would not be such a smart move after all for Germany to cancel its nuclear fuel reprocessing contracts with BNFL without compensation. First there would have been the court case with the British government. Then there would have been the trickier matter of what to do with 500 tonnes of radioactive waste arriving back on the German Chancellor's doorstep. As Mr Schroder's more militant Green supporters have ably demonstrated, trainloads of plutonium trundling across the German hinterland do not make for good public order.

The French, however, are made of more slippery stuff, and yesterday they won the tussle over where Electricite de France's pounds 1.9bn takeover of London Electricity should be vetted. Brussels decided to keep the merger for itself and promptly waved the deal through on the grounds that who keeps the lights burning for two million Londoners is neither here nor there in the great European scheme of things. So much for subsidiarity.

Having played the "national interest" card and been roundly ignored, the Department of Trade and Industry was left to sift the wreckage for scraps of consolation. The worst that regulators here will be able to do is tinker with EdF's licence.

But they will not now be able to stop the merger by referring it to the Monopolies and Mergers Commission. Nor will they be able to ask the French why it is possible for EdF to buy London but impossible for London, or anyone else on this side of the Channel for that matter, to buy EdF. Nor, finally, will they have the leverage to persuade EdF that the interconnector, through which it supplies 7 per cent of the UK electricity market, really ought to run in both directions.

It is easy to see why the French are so keen on the UK market. The new energy regulator, Callum McCarthy, let the cat out of the bag yesterday by conceding that the generators have been rigging the electricity pool for the past nine years. As it will take another few years before the pool is fully reformed and operating in a proper competitive fashion, there is still plenty of scope to make money at the consumer's expense. Backed by the bottomless pit otherwise known as the French taxpayer, EdF can hardly wait to get started.

But the real villain of the piece is the European Commission. From the moment the auction for London Electricity began, Brussels allowed EdF to drive a coach and horses through its own merger rules. The most important one is the rule that says companies cannot launch unconditional bids if the takeover qualifies for examination by the EC's mergers task force. The rule was waived in the case of EdF, giving it a crucial competitive advantage in the final stages of the auction.

There is the unmistakeable smell of stitch-up in the air and power politics that go far beyond parochial concerns about another vertically integrated player entering the UK electricity market. British Energy, the loser in the auction, could lodge a formal complaint, but it probably won't. At the least there should be an investigation into exactly how and why the Commission came to give the French such a free run.

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
News
video
Arts and Entertainment
tv

First full-length look is finally here

Arts and Entertainment
Stanley Tucci as DCI Eugene Morton, Sophie Grabol as Hildur Odegard and Christopher Eccleston as Professor Charlie Stoddart in 'Fortitude'
tvGrace Dent: Still, it's compelling and cinematically sublime
News
news

Rap music mogul accused of running two men over in his truck

Arts and Entertainment
EastEnders actor Danny Dyer has been rejected from Game of Thrones three times
tv
Arts and Entertainment
Frank Turner performing at 93 Feet East
musicReview: 93 Feet East, London
News
Toronto tops the charts across a range of indexes
news

World cities ranked in terms of safety, food security and 'liveability'

ebooks
ebooksA special investigation by Andy McSmith
Voices
A mother and her child
voices
Voices
The veterans Mark Hayward, Hugh Thompson and Sean Staines (back) with Grayson Perry (front left) and Evgeny Lebedev
charity appealMaverick artist Grayson Perry backs our campaign
News
Tax now accounts for ‘nearly 80%’ of the price of a bottle of whisky
news

Arts and Entertainment
Peppa Pig wearing her golden boots
film

"Oink! Oink! Hee hee hee!" First interview with the big-screen star

Life and Style
tech

Biohacking group hopes technology will lead people to think about even more dystopian uses

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Ashdown Group: Product Manager - (Product Marketing, Financial Services)

£30000 - £35000 per annum + Benefits: Ashdown Group: Marketing Manager - Marke...

Recruitment Genius: Compliance Assistant

£13000 per annum: Recruitment Genius: This Pension Specialist was established ...

Ashdown Group: Market Research Executive

£23000 - £26000 per annum + Benefits: Ashdown Group: Market Research Executive...

Recruitment Genius: Technical Report Writer

£25000 - £35000 per annum: Recruitment Genius: A Technical Report Writer is re...

Day In a Page

Isis hostage crisis: The prisoner swap has only one purpose for the militants - recognition its Islamic State exists and that foreign nations acknowledge its power

Isis hostage crisis

The prisoner swap has only one purpose for the militants - recognition its Islamic State exists and that foreign nations acknowledge its power, says Robert Fisk
Missing salvage expert who found $50m of sunken treasure before disappearing, tracked down at last

The runaway buccaneers and the ship full of gold

Salvage expert Tommy Thompson found sunken treasure worth millions. Then he vanished... until now
Homeless Veterans appeal: ‘If you’re hard on the world you are hard on yourself’

Homeless Veterans appeal: ‘If you’re hard on the world you are hard on yourself’

Maverick artist Grayson Perry backs our campaign
Assisted Dying Bill: I want to be able to decide about my own death - I want to have control of my life

Assisted Dying Bill: 'I want control of my life'

This week the Assisted Dying Bill is debated in the Lords. Virginia Ironside, who has already made plans for her own self-deliverance, argues that it's time we allowed people a humane, compassionate death
Move over, kale - cabbage is the new rising star

Cabbage is king again

Sophie Morris banishes thoughts of soggy school dinners and turns over a new leaf
11 best winter skin treats

Give your moisturiser a helping hand: 11 best winter skin treats

Get an extra boost of nourishment from one of these hard-working products
Paul Scholes column: The more Jose Mourinho attempts to influence match officials, the more they are likely to ignore him

Paul Scholes column

The more Jose Mourinho attempts to influence match officials, the more they are likely to ignore him
Frank Warren column: No cigar, but pots of money: here come the Cubans

Frank Warren's Ringside

No cigar, but pots of money: here come the Cubans
Isis hostage crisis: Militant group stands strong as its numerous enemies fail to find a common plan to defeat it

Isis stands strong as its numerous enemies fail to find a common plan to defeat it

The jihadis are being squeezed militarily and economically, but there is no sign of an implosion, says Patrick Cockburn
Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action

Virtual reality: Seeing is believing

Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action
Homeless Veterans appeal: MP says Coalition ‘not doing enough’

Homeless Veterans appeal

MP says Coalition ‘not doing enough’ to help
Larry David, Steve Coogan and other comedians share stories of depression in new documentary

Comedians share stories of depression

The director of the new documentary, Kevin Pollak, tells Jessica Barrett how he got them to talk
Has The Archers lost the plot with it's spicy storylines?

Has The Archers lost the plot?

A growing number of listeners are voicing their discontent over the rural soap's spicy storylines; so loudly that even the BBC's director-general seems worried, says Simon Kelner
English Heritage adds 14 post-war office buildings to its protected lists

14 office buildings added to protected lists

Christopher Beanland explores the underrated appeal of these palaces of pen-pushing
Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Scientists unearthed the cranial fragments from Manot Cave in West Galilee