(FRANKFURT) - The European Union's executive commission is a bigger threat to EU energy companies than Russia, the head of German energy giant EON was quoted Monday as saying in a press report.

"You are always talking about Russia but the real threat is coming from the European Commission," EON chief executive Wulf Bernotat told the Financial Times.

Bernotat added however that he did not think commission plans to increase competition by breaking up big power groups through a process called unbundling would succeed because they were opposed by major EU members.

"I am pretty sure unbundling is not coming," he said. "Such processes in Brussels take time especially if important member states such as France and Germany are against it."

Meanwhile, many in Europe have rung alarms over what they see as Russian intentions to dominate the European energy sector through investments by groups such as the state-controlled gas monopoly Gazprom.

EU officials want to increase competition in the energy sector by separating energy production and distribution activities, amid sharply rising prices that have sparked widespread debate in Germany.

EON and rival RWE have a particularly dominant position in the country.

Over the weekend, EU Competition Commissioner Neelie Kroes argued again for liberalisation measures, saying that "in Germany, prices are higher than you might expect in a market that was fully competitive."

She added that the commission's plan to break-up the two key activities of production and distribution was "indispensible" if consumers were to benefit from the lower prices for gas and electricity that an open market could provide.

Gemany has backed its big energy groups in the stand-off with EU officials, but Berlin has said that position could change if power groups did not make a bigger effort to increase competition and transparency within their operations.

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