wer-generation and retail companies, and the acquisition by generating companies of retail operations. Economies of scale are clearly a major driver of this reintegration trend, particularly in retailing: a relatively large number of customers seem necessary to make a profitable business of supplying small commercial and residential consumers. In power generation, mergers and acquisitions can help improve the stability of cash flow as a source of finance for large capital-intensive investments in an environment where there is reduced access to debt capital. This has been a key driver in the emergence in Europe of "Seven Brothers" - EdF, E.On, RWE, Vattenfall, Endesa, Electrabel and Enel. These very large electricity firms, which also have significant investments in other businesses, are expected to finance a significant portion of new investment from internal resources. This consolidation has raised concerns about undue concentration and its impact on competition and pricing. In OECD countries generally, electricity companies finance new projects by providing part of the project capital as equity (internally generated cash or equity issued as public shares). The remainder is financed as debt, with borrowing from banks or through issuing bonds. The current debt-equity structure of OECD power companies varies considerably, with some countries having seen an increase in the share of debt and others a fall (Figure 3.14). Japan relies more on debt, while reliance on equity is larger in the United States. Companies with high levels of debt, such as Japan and France, INFRASTRUCTURE TO 2030: TELECOM, LAND TRANSPORT, WATER AND ELECTRICITY - ISBN 92-64-02398-4 © OECD 2006 3. OUTLOOK FOR GLOBAL INVESTMENT IN ELECTRICITY INFRASTRUCTURE Figure 3.14. Debt-equity ratio¹ of power in selected OECD countries United States Germany Spain France Japan United Kingdom Note: For France, the sharp change in EdF's debt-equity structure in 1997 was due to the issuance of stocks. 1. Share of total debt in the sum of shareholders' equity and