Competition authority targets Heidjers Stadtwerke in investigation
In the heart of Germany, the state of Lower Saxony has been grappling with soaring gas prices. A recent investigation by the energy sector supervisory authority has exposed significant price disparities among 72 basic gas suppliers operating in the region.
The issue surfaced as early as January 2023, with households in the most expensive network area paying a staggering 220 percent more for their gas compared to those in the cheapest area. This price gap raised concerns about potential exploitation by some suppliers lacking competition.
Basic suppliers, dominating the energy market with the most household customers in a region, do not compete with each other due to their network areas. This setup allows gas prices to vary without competitive pressure to drive them down.
One such supplier under scrutiny is Heidjers Stadtwerke, which ranked 2nd out of 72 basic suppliers for a gas price of 15,000 kWh in September 2024. The gas price from Heidjers Stadtwerke at that time was approximately 2,500 euros, about 10% higher than the average price of the other 71 basic suppliers in Lower Saxony.
The state cartel authority argues that the price spreads should have narrowed by September 2024, but they were twice as high as before the energy crisis triggered by the outbreak of war in Ukraine. Despite a narrowing gap in the fall of 2024, it still stood at 106 percent.
Heidjers Stadtwerke remains under the watchful eye of the state cartel authority, with investigations ongoing to determine if any unfair practices have been employed to maintain high gas prices.
Prices and price components were evaluated over a period of three years, starting on September 1, 2021, and captured the market before, during, and after the energy crisis. The findings suggest that some suppliers may have exploited the lack of competition by excessively increasing gas prices.
As the situation develops, Lower Saxony residents hope for a fair and competitive energy market, ensuring affordable gas prices for all households.
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