The effect of energy market liberalization on EU competition

A new entrant in a network industry faces a very difficult situation if it wishes to compete with a company already on the market. According to Bara (2006), competition is endangered by two factors: the state and the competitors themselves. However, such sectors exist where competition can not develop in a natural manner. Concerning the network industries and the competition policy guarding the newly formed/forming competitive energy markets, the challenge is especially the characteristic that the operation of the market, the opening itself, is not necessarily able to eliminate the monopoly structure. Thus the subject of our analysis is the effect of energy market liberalization, launched a decade ago in the European Union, on the competition in the sector. Has the European Union in reality reached the effect it planned or has the opposite occurred