Investment banks and energy traders in London are opposing the European Commission's plan to enforce tougher regulation upon the energy trading markets, the Financial Times has reported.
<p>It is believed that the commission is intending to introduce the scheme, which would force energy traders to report their trading activities in a more transparent manner, alongside controversial plans to force integrated energy companies to divest assets such as pipelines and power grids. <br /><br />According to the Financial Times, the commission's proposal would align the electricity and gas trading markets with the shares and bonds markets. This has led to concerns regarding liquidity, the report said. <br /><br />The report quoted a letter sent by six trade associations, as saying: In their current form [the proposals] risk damaging liquidity in wholesale electricity and gas markets. <br /><br />We believe strongly that the European Commission should be able to demonstrate a clear business case to justify these proposals. We remain to be convinced that any such business case has yet been proven, the letter continued.</p>