Competition authorities probe Electrabel over gas prices
The federal competition authorities have opened an investigation into alleged manipulation of gas prices by Electrabel, federal economy minister Vincent Van Quickenborne announced at the weekend. The allegations arise out of a report by the energy market regulator, the Commission for Electricity and Gas Regulation (CREG). “The prices are still much too high,” said CREG chairman François Possemiers. “The consumer is still not getting the prices he is entitled to.”
The energy market in Belgium was liberalised in two parts: first the market for business and industry, from the year 2000, then the domestic market, in 2003 in Flanders and four years later in Wallonia and Brussels. However, Electrabel, now 100% owned by the French holding company Suez, is still by far the major provider of electricity in the country and the second-largest supplier of gas.
“We thought there would be more competitive pressure on prices,” said Possemiers. “That hasn’t happened.” Prices instead continue to rise: following a recent reduction in tariffs for transport and distribution of gas, prices went straight back up again less than two months later. And, despite reductions in oil and gas prices internationally, the consumer saw little benefit. “We noticed that when world prices came down, the companies simply increased their profit margins,” he said.
Last year, the CREG accused Electrabel of price manipulation, which the company denied. Now further research has shown that their conclusions were correct. The main problem, CREG says, lies in the fixing of the market index, which is used to calculate prices for long-term contracts with businesses. The new study is now on the desk of energy minister Paul Magnette. Electrabel is not alone; according to one report, SPE-Luminus and Distrigas are also named. “In a few weeks we will know if the Competition Council considers the complaint serious enough to open a full investigation,” said Van Quickenborne. “We take it extremely seriously. The companies should know that manipulation of market prices will not be accepted. And they needn’t think they’ll get off with a fine.”
