‘Impressive’ energy cartel uncovered in Germany

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The German cartel office has compiled considerable evidence of price fixing and anti-competitive behaviour by Germany’s four main electricity and gas suppliers, according to information obtained by the Spiegel.

In a series of secret meetings between 2003 and 2006, the chief executives of Germany’s four main energy suppliers E.ON, RWE, Vattenfall (of Sweden) and EnBW (partially owned by France’s EDF) exchanged sensitive and secret information about their companies and discussed common strategies for a variety of markets, according to the Spiegel

The German weekly reported on 3 November that the German cartel office (Kartellamt) had already compiled a 30-page report in November 2006 containing far-reaching allegations of cartel-like behaviour, based on thousands of pieces of evidence obtained through raids by the Commission’s Directorate-General for Competition. 

E.ON in particular devoted considerable efforts to influencing the price of energy, including through the premature decommissioning of power plants, according to the report.

The Kartellamt said that evidence of cartel-like behaviour emerged in an ‘impressive’ manner during the investigation.

It remains unclear if evidence of cartel activity will alter Germany’s opposition to proposed new rules to liberalise the EU’s energy markets. But the economy ministers of two of Germany’s largest Länder – Schleswig-Holstein’s Dietrich Austermann and Hessen’s Alois Rhiel, both Christian Democrats – have already stepped up calls for the dismantling of the energy giants following the Spiegel story.

And on 21 October, just over one week before news of the cartel emerged, Germany’s Economy Minister Michael Glos raised doubts about the most recent and apparently coordinated electricity and gas price increases by E.ON and RWE, according to Reuters.

Glos questioned in particular how the price increases could be justified given the overwhelming reliance on inexpensive brown coal and nearly depreciated nuclear power stations for electricity production.

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