Thursday 2 May 2019

Ofgem considers closing investigation into power exchange firm EPEX

Ofgem said it is considering closing its investigation into EPEX after the power exchange company made commitments that will avoid distorting competition.

The regulator launched an investigation last December into whether EPEX had abused a dominant position by failing to take the steps required to enable rival Nord Pool to participate in certain electricity trading auctions between Britain and Irish energy markets.

The arrangements to implement the auctions between markets in Britain and Ireland -which went live in October 2018 - were intended to provide for both Nord Pool and EPEX to participate. However, to date, only EPEX has been able to do so.

Ofgem said EPEX’s actions in preventing Nord Pool from entering the market were likely to have distorted competition, which could lead to an increase in feed or a reduction in service or choice for customers using the power exchange.

The regulator added: “As a result of the investigation, EPEX has committed to taking the steps required of it to enable Nord Pool – EPEX’s main competitor in Great Britain – to participate in these auctions and also to carry out an internal review of its competition law training.

“Ofgem is minded to close the investigation with the acceptance of commitments. The commitments address Ofgem’s concerns and should ensure that Nord Pool is able to access the auctions by 23 July 2019."

The electricity near-term trading market operates a competitive model, with two competing power exchanges, which are both also Nominated Electricity Market Operators designated to perform single day-ahead and single intra-day coupling with other European electricity markets. The two Nominated Electricity Market Operators in Great Britain are EPEX and Nord Pool.

The regulator is consulting on the commitments made by EPEX and its parent company European Energy Exchange (EEX) until 16th May 2019.