Brussels, 7 February 2024
The European Commission has informed the Greek electricity provider Public Power Corporation (‘PPC’) of its preliminary view that it has breached EU antitrust rules by selling electricity in the Greek wholesale market below cost, thereby excluding its main rivals.
PPC is the largest supplier of retail and wholesale electricity in Greece, in which the Greek State holds an important minority stake. Between 2013 to 2019, PPC controlled all lignite and hydro capacity as well as some of the natural gas and renewable power generation plants. It was also active in the supply of energy to retail and business consumers.
The Commission’s preliminary view is that PPC held a dominant position in the interconnected Greek wholesale electricity market, which during the period concerned comprised Greek mainland as well as the Ionian and a few Aegean islands.
The Commission has preliminary concerns that, between 2013 and 2019, PPC abused its dominant position on the Greek wholesale electricity market by supplying the electricity generated by its thermal plants (i.e., lignite and gas) at prices below their variable costs (meaning those costs that increase with the volume of electricity generated by PPC).
The suspected effects of this alleged conduct on the Greek wholesale market for electricity were that independent power providers were marginalized and investment into more environmentally friendly energy sources was deterred. This could have prevented the independent power providers from expanding at the retail level, thwarting the efforts towards retail market liberalisation that was formally completed in July 2013. Therefore, PPC’s conduct may have led to higher prices for Greek consumers, as well as higher emission levels of local pollution.
If the Commission’s preliminary view is confirmed, this conduct would infringe Article 102 of the Treaty on the Functioning of the European Union (‘TFEU’), which prohibits the abuse of a dominant position.
The sending of a Statement of Objections does not prejudge the outcome of an investigation.
Background
In March 2021, the Commission opened a formal antitrust investigation to assess possible abusive behaviour by PPC in the wholesale Greek electricity sector.
Article 102 TFEU prohibits the abuse of a dominant market position, which may affect trade between Member States. The implementation of this provision is defined in Regulation No 1/2003, which can be applied by the Commission and by the national competition authorities of EU Member States.
A Statement of Objections is a formal step in the Commission’s investigations into suspected violations of EU antitrust rules. The Commission informs the parties concerned in writing of the objections raised against them. The parties can then examine the documents in the Commission’s investigation file, reply in writing and request an oral hearing to present their views on the case before representatives of the Commission and national competition authorities.
If the Commission concludes, after the parties have exercised their rights of defence, that there is sufficient evidence of an infringement, it can adopt a decision prohibiting the conduct and imposing a fine of up to 10% of a company’s annual worldwide turnover.
There is no legal deadline for the Commission to complete antitrust inquiries into anticompetitive conduct. The duration of an antitrust investigation depends on a number of factors, including the complexity of the case, the extent to which the companies concerned cooperate with the Commission and the exercise of the rights of defence.
For More Information
More information on the investigation will be available under the case number AT.40278 in the public case register on the Commission’s competition website.
Quotes
We are concerned that the Greek Public Power Corporation, PPC, may have abused its dominant position by selling at prices below cost in the wholesale market for more than six years. PPC’s conduct reduced the electricity generated by its environmentally cleaner rival generators. The conduct also hampered competition at retail level. A less competitive retail market meant that these lower wholesale prices were not passed on to businesses and consumers. Greek consumers may therefore have suffered from high retail prices and more local pollution.