EU report criticises low competition on Austrian natural gas market
A European Commission report published on Thursday criticised the Austrian natural gas market's low level of competition and the high concentration of power held by its established energy companies.
The directors of Austrian energy regulator E-Control, Walter Boltz and Martin Graf, reiterated that the Commission's paper was grist to the mill for their efforts to increase competition. "We're still far off from competition on the Austrian energy market," Boltz admitted.
The report claimed the congestion of the transmission system was one of the main barriers to greater competition because it makes it hard for new market entrants to gain access to transport capacity. The report emphasised that, in 2009, there was no available firm capacity at the Oberkappel and Baumgarten entry points through West Austria Gasleitung (WAG) or Trans-Austria Gasleitung (TAG), despite capacity often being under-utilised.
The Commission also found fault with the lack of sellers offering significant volumes on Austria's over-the-counter trading platform, the Central European Gas Hub (CEGH). The comparatively low traded volumes and liquidity at CEGH could be attributed to this problem.
The report used data from 2010 but came to the conclusion that the concentration on the market of available suppliers is "high". According to the report, the Austrian market reached a value of 3,371 on the Herfindahl-Hirschman Index. Values between 1,800-5,000 are regarded as "high market concentration". Furthermore, the Commission regarded only four companies as "main gas entities", a designation indicating that they handle more than 5% of the country's natural gas.
The Austrian regulator wants to improve competition by implementing the requirements of the EU's third energy package and turning CEGH from a physical hub into a virtual trading point from January (see ESGM 25 May 2012). MH
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