Sanctioning excessive energy prices as abuse of dominance : are the EU commission and the national competition authorities on the same frequency?

Abstract

Following the 2007 Sector Inquiry into the energy sector, the EU Commission has actively enforced Article 102 TFEU to sanction different forms of abuse of dominance by energy operators. Most of the cases have been concluded via commitments decisions which mainly included far-reaching structural (i.e. divestiture of capacity) rather than behavioural remedies. Moreover, in its commitment decisions the EU Commission has mainly targeted exclusionary conducts by energy undertakings, rather than directly sanctioning the excessive pricing in the wholesale and retail markets as exploitative abuses of dominance. Unlike the EU Commission, the National Competition Authorities (NCAs) of the EU Member States have directly sanctioned excessive pricing both at the wholesale and retail level as exploitative abuses of dominance. In particular, a number of NCAs have sanctioned withdrawals of capacity by electricity generators as abuses of dominance, since such conduct caused a direct rise of wholesale electricity prices. Secondly, NCAs of a number of EU Member States have also sanctioned the excessive prices in the retail energy markets imposed by undertakings on final customers. Besides the different focus in the enforcement of Article 102 TFEU in the energy markets in comparison to the EU Commission, the NCAs have mostly opted for imposition of fines on the sanctioned undertakings, rather than imposing structural remedies via commitment decisions. The chapter aims to analyse the enforcement trends of Article 102 TFEU by the NCAs with regard to excessive prices applied by energy operators in the wholesale and retail markets. In particular, the chapter compares such pattern of enforcement with that followed by the EU Commission in this sector during the past few years. The chapter tries to identify the reasons for the different focus of the authorities at national and EU level. It also discusses whether such divergences in the enforcement of Article 102 TFEU are justified in the light of the decentralized enforcement system of EU competition law.