May, 2002

Dear USTR:

This comprises the unified comment of the Energy Services Coalition, a grouping of 60 U.S.

trade associations, companies and other organizations seeking liberalization of energy services in

the context of the services negotiations.

All nations and all forms of economic activity   developed or developing economy; agriculture,

manufacturing, or services company   depend on clean, reliable, efficiently produced, and

reasonably priced energy.  Demand for energy continues to grow.  According to the U.S.

Department of Energy, global energy consumption is projected to rise by 60 percent over the

next 20 years.  Almost two thirds of the increase in demand is projected to occur in developing

countries.

There has been no internationally agreed definition or classification of energy services.  Yet for

those companies active in the sector, there is wide agreement about the types of activities that

comprise energy services.  As a working definition of energy services, the Energy Services

Coalition has adopted the following:

Energy services are those services that comprise or are related to the exploration,

development, extraction, production, generation, transportation, transmission,

distribution, marketing, consumption, management and efficiency of energy, energy

products and fuels.

The reasoning behind the definition is simple   energy services comprise a closely related set of

activities that begins with the process of locating and developing energy resources, through their

production and provision to final consumers, to cleanup and decommissioning, to activities in

every stage to promote the development and usage of clean and energy efficient technologies.

Energy services did not have a discrete classification under the WTO system.  When the GATS

was negotiated, the energy sector largely was dominated by state owned monopolies operating

within national (or even subnational) markets.  Whether public or private, oil and gas companies

and power generating utilities performed most of their own services internally.

Until the creation of the ESC, the WTO had but three classifications that specifically provide for

limited elements of the energy services sector, including:

Services incidental to mining;

Services incidental to energy distribution; and

Pipeline transport.

These classifications are obviously too narrowly defined and do not cover the breadth of energy

services activities, including those related to energy development, production, energy networks,

and wholesale and retail activities.

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