Bundeskartellamt Publishes 2022/2023 Report on the Market Power Situation in Electricity Generation

The Bundeskartellamt has published its fourth report on competition in electricity generation, the "Market Power Report".

The report analyses the market power situation in the generation and initial sale of electricity for the period from 1 October 2021 to 31 March 2023. The analyses are based on comprehensive data on the utilization of all power plants in Germany.

Market shares are a common indicator of a company's competitive importance. However, in the case of electricity generation, market shares do not provide meaningful information because electricity is not storable. Therefore, the percentage of market share a company achieves during the year is not decisive.

Holding a dominant position has important consequences for electricity producers. In particular, they are not allowed to artificially retain their generation capacity, as this makes it possible for them to manipulate and raise prices in times of supply shortages.

With the Market Power Report, the Bundeskartellamt aims to assist electricity producers in assessing whether they are subject to abuse control by the authority and thus prohibited from manipulatively withholding capacity.

Towards the beginning of 2022, a number of German power plants were permanently shut down, including three nuclear power plants. In the context of the increase in electricity prices in the context of the situation between Russia and Ukraine, the operating life of three other nuclear power plants was extended and some coal-fired power plants were restarted for a significant period of time.

The Bundeskartellamt also analyzed how unused foreign power plant capacities and thus electricity imports affected the development of the market power situation during the reporting period.

The Bundeskartellamt has a legal obligation to publish a Market Power Report at least every two years.

The full text of the aforementioned Report is available here.

Sincerely,

Zümbül Law and Consulting

info@zumbul.av.tr