EU Opens Antitrust Probe Into Europe’s Biggest Power Exchange

The European Commission is investigating whether the region’s biggest exchange for short-term power trading blocked competitors in as many as six national markets.

Epex Spot SE exchange in Paris dominates trading in contracts for the same day in markets flagged by the EC, including Austria, Belgium, France, Germany, Luxembourg and the Netherlands. The commission will now investigate if it used its position to shut out customers of other exchanges to access the best prices and liquidity.

As electricity cannot be stored in any large scale it is vital for traders to have access to as many sellers and buyers as possible, especially on the intraday markets, which trade until delivery later in the same hour. Hence the exchange with the most liquidity will attract most traders, while bourses without enough activity will have a harder time attracting business.

To avoid one single exchange taking over all short-term trading, the EU has set out rules for sharing data so customers can get the same price regardless of which exchange they use. Epex Spot objected to the practice of shared order books, but succumbed when it was introduced at the end of last decade. Now the commission wants to ensure it is not still unfairly holding back access.

“Preserving healthy competition between power exchanges and between traders contributes to accurate price and investment signals for new sources of energy,” Competition Commissioner Margrethe Vestager said in a statement. “Power exchanges are central to the efficient functioning of electricity markets.“

Epex Spot declined to comment the ongoing probe. It said its cooperation with authorities did not imply that the exchange had “acted in breach of the EU competition rules.” Its main competitor, the Oslo-based exchange Nord Pool Spot AS, also declined to comment.

The two exchanges were fined 6 million euros back in 2014 for co-operating too closely. Since then, they have become the two main competitors in European short-term power, operating in the same nations.

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