Bundeskartellamt achieves further concessions in gas price proceedings

In the proceedings instituted against gas suppliers on suspicion of abusive pricing in December 2004 the Bundeskartellamt has concluded two further cases (cf. Bundeskartellamt press release of 6 April 2005).

MITGAS Mitteldeutsche Gasversorgung GmbH, Gröbers, which had last raised its gas prices on 1 January 2005, has agreed to waive further gas price rises until 30 September 2005. As of 1 October 2005 the company will at most pass on increased procurement costs to households and small commercial customers. In addition, MITGAS will introduce a new product package on 1 May 2005 which will be 0.3 ct/kWh cheaper than the so-called “classic tariff” and which will have a period of validity of two years. Until 31 December 2005 MITGAS customers may switch to this new product without having to observe specific periods of notice.

SWU Energie GmbH (Ulm municipal utilities) has also agreed not to raise prices until 30 September 2005 despite its procurement cost increase of 0.38 ct/kWh. Although the new tariffs will be based on the increased procurement costs as of 1 October 2005, SWU will grant a reduction of 0.1 ct/kWh on them. In addition, as of 1 October 2005 SWU will introduce a fixed-price product which will be 0.2 ct/kWh net below the heating gas price at that time and will be valid for one year.

The proceedings against Rhenag Rheinische Energie AG, Siegburg, are currently suspended; the proceedings against RWE Westfalen-Weser-Ems AG, Dortmund, are still pending.

The President of the Bundeskartellamt, Ulf Böge, expressed his satisfaction with the results achieved and said that the reductions made to the envisaged prices by the companies led to a tangible cost relief for the consumer. Even more important was the increased awareness of those responsible in the gas supply companies that price rises could not easily be enforced simply by market power. Thus, the negotiation of cheap purchasing prices for gas was gaining new significance. “Those companies concluding unfavourable contracts with their suppliers will charge higher prices than other gas providers to final distributors and consequently come under pressure.”