BERLIN, Feb 19 (Reuters) - Changes in Germany's power market have increased the clout of top producers RWE, LEAG and EnBW, the country's cartel office said on Thursday, increasing supply risks and
German Watchdog Warns Rising Power Supplier Clout Threatens Market
BERLIN, Feb 19 (Reuters) - Changes in Germany's power market have increased the clout of top producers RWE, LEAG and EnBW, the country's cartel office said on Thursday, increasing supply risks and reliance on imports.
The Bundeskartellamt's annual report, based on data from May 2024 to April 2025, found that Germany's shift away from flexible power supply sources - such as coal and nuclear - had left remaining plants increasingly crucial for meeting demand.
The country temporarily reactivated reserve stations during an energy crisis sparked by Russia's war in Ukraine, but from early 2024 returned to its original path to phase out coal.
Market Concentration and Supply Risks
FEWER FLEXIBLE PLANTS, HIGHER PRICES
5% indispensability benchmark
Dominance Thresholds and Key Players
The cartel office said RWE and LEAG were found to exceed the threshold for market dominance, defined as being indispensable for demand in more than 5% of hours per year. EnBW was close to the threshold but did not surpass it.
Price Effects and Import Dependence
The report warned that a shortage of dispatchable capacity tends to lead to higher prices and increases dependence on large suppliers, while imports are needed more often, especially during periods of low wind and solar generation.
In almost a quarter of all hours during the reporting period, domestic demand could only be met with imported electricity.
Tenders and Long-Term Competition
TENDERS AND COMPETITION OUTLOOK
"The results of the upcoming power plant tenders will have a significant impact on market concentration for decades to come," Bundeskartellamt President Andreas Mundt said in a statement. He said tenders should be used to reduce existing market power and suggested capping awards to diversify ownership.
Review of Late-2024 Price Spikes
Investigations by the cartel office and the Federal Network Agency into price spikes in late 2024 found no evidence of abusive withholding of capacity, the office said.
(Reporting by Linda Pasquini. Editing by Kirsti Knolle and Mark Potter)
