Bundeskartellamt examines excessive district heating prices

The Bundeskartellamt has instituted proceedings against seven district heating suppliers on suspicion of their charging abusively excessive prices. The investigations will focus on around 30 different supply areas throughout nearly all the federal states.

Andreas Mundt, President of the Bundeskartellamt: "District heating customers can only choose between different supply channels before they make an initial decision in favour of a certain heating system. Once they have decided in favour of district heating, they have no option in the long term to switch. Hence the need for the Bundeskartellamt to initiate abuse proceedings where prices are excessive, in order to protect consumers. Apart from this, access to the district heating network is mandatory in many supply areas, which means that it is neither physically nor legally possible for customers to switch to another energy supplier."

During the Sector Inquiry into District Heating (available only in German) (see Press Release of 23.08.2012) the Bundeskartellamt collected data from district heating suppliers for 2007 and 2008 and compared revenues. It found that the average revenues earned by some companies from the supply of district heating clearly exceeded those of the respective comparison group. The Bundeskartellamt is now following up the initial suspicion of abusive pricing raised by these findings.

Proceedings were instituted against the following companies:

Dalkia GmbH, Hamburg; Danpower Energie Service GmbH, Potsdam; Energie SaarLor Lux AG, Saarbrücken; E.ON Hanse Wärme GmbH, Hamburg; RWE Energiedienstleistungen GmbH, Dortmund (formerly: ExxonMobil/Favorit Fernwärme GmbH); Stadtwerke Leipzig GmbH, Leipzig; Stadtwerke Rostock AG, Rostock.

In order to update the information gathered from the sector inquiry, data will now be collected for 2010 to 2012 from both the companies involved as well as eight potentially comparable suppliers with on average very low revenues and low district heating prices. Since concluding its sector inquiry the Bundeskartellamt has revised its questionnaire and subjected it to a market test in order to create a data basis which is even more accurate.

District heating providers often supply several different areas. Tariffs of the same provider may deviate in the different supply areas. There is no general indication of excessively high revenues in all the supply areas of the companies against which the Bundeskartellamt has now instituted proceedings.

The different levels of district heating supply, i.e. generation, network operation and distribution, are normally integrated in one company. Different structural conditions, such as e.g. generation and network structures, can justify different revenue and price levels, which has to be examined on a case by case basis.

It will also have to be assessed to what extent the economic efficiency of heat generation plants which also produce electricity from combined heat and power generation has suffered because electricity prices have fallen at the exchange (due to the increasingly subsidised feed-in of renewable energies).