Germany takes steps to improve competition in its energy market


Matthias KurthBerlin, Germany — (METERING.COM) — August 30, 2006 – Matthias Kurth, President of the Federal Network Agency, Germany’s grid regulator, has presented the first monitoring report on the energy market in the country.

"There is a comprehensive and complex need for action to improve competition on the energy market and only a coordinated bundle of measures will enhance competition on that market", according to Kurth, who went on to say: "Support of new power stations and the build-up of existing ones by fair network access conditions is just as important as simplifying customer transition in the electricity and the gas sector by cheap automated processes.“

The report found that network rates are much more important to private customers in the electricity than in the gas sector, and that 38 per cent of the retail prices of electricity compared with 22 per cent of the retail prices for gas are determined by network costs. A drop in network rates will therefore have a diverging impact on the network rates in terms of household prices.

In recent weeks the four companies dominating the electricity market – E.ON, EnBW, RWE and Vattenfall – have been told to lower their HV grid access charges for smaller energy providers. German customers are, however, still paying some of the highest prices for energy in the European Union.

"Lower network costs and transparent and simple network usage rules should, of course, facilitate entry to the energy markets.“ said Kurth. "Here, our report shows that the gas market still lacks adequate collateral conditions and that certain aspects of the electricity market also show room for improvement.

"The task facing us is so diverse and to a certain degree rather difficult that we must ask for your forbearance for not being able to undertake all necessary changes overnight at the mere touch of a button. The companies in the sectors involved also need to accompany our work on a constructive, factual and cooperative basis for the desired results to be achieved."