The Bundeskartellamt has published its sixth report on the competitive conditions in electricity generation, focusing on the market power dynamics in the production and initial sale of electricity. The analysis is based on data from May 1, 2024, to April 30, 2025, following the exit of numerous controllable power plants in early 2024.

According to Andreas Mundt, President of the Bundeskartellamt, the market power of leading electricity producers in Germany, namely RWE, LEAG, and EnBW, has significantly increased. The exit of controllable power plants has immediate effects on competition and market power, as the remaining plants become essential for meeting demand.

This development is primarily attributed to a notable decline in available controllable generation capacities. The planned reactivation of reserve power plants, initiated in 2022 due to the geopolitical situation, ended in early 2024, returning to the original coal exit path.

The report emphasizes that merely looking at market shares is insufficient for assessing market power in the electricity sales market. Unlike other markets, power plant operators can significantly influence market prices even with relatively low market shares. The authority focuses on how often a power producer is pivotal for meeting electricity demand, with a threshold of five percent of annual hours indicating a dominant market position.

RWE exceeds this threshold, while LEAG also shows values above the presumption threshold. EnBW's values are close to the threshold but do not exceed it. The report critically assesses proposals to split the German-Luxembourg electricity bidding zone, as this could further enhance the market power of large providers.

The potential existence of a dominant position has legal implications for market behavior. Dominant power plant operators are prohibited from withholding generation capacities to artificially inflate prices. However, the report does not formally establish a dominant position, which can only be determined through specific case assessments.

A short-term easing of market power conditions is not anticipated. The government's announced tenders for the construction of controllable power capacities may take years to impact supply due to construction times. The competitive effect will also depend on which providers operate the new capacities.

Mundt stated that the results of upcoming power plant tenders will significantly influence market concentration for decades. To ensure supplier diversity, it would be wise to limit the award to ten percent of the total capacity per bidder. Increased competition in electricity generation markets will lead to sustainable benefits, particularly in the form of lower prices for consumers.

The report notes a significant decline in controllable electricity generation capacities in Germany. The end of the temporary reactivation of reserve power plants and further shutdowns, particularly due to the coal exit, has noticeably tightened domestic supply. This scarcity tends to lead to higher prices and increases dependence on large providers in electricity sales.

The increasing scarcity also affects market dynamics. In situations of high demand and low renewable input, controllable power plants become more essential. At the same time, more pronounced price spikes occur in the short-term electricity wholesale market, especially during winter months and at peak times. Investigations by the Bundeskartellamt and the Federal Network Agency into price spikes during low renewable input periods in late 2024 found no evidence of abusive capacity withholding; rather, the scarcity of controllable capacities was the decisive factor.

The significance of European electricity market integration for supply in Germany has also increased. In nearly a quarter of all hours during the reporting period, domestic electricity demand could only be fully met through imports. While import options can limit market power, their effectiveness depends on the availability of cross-border lines and foreign generation capacities.

The report also examines market conditions in the area of ancillary services, which have not changed significantly compared to the previous reporting period, with EnBW continuing to play a leading role in providing certain ancillary service products.

The complete Market Power Report for Electricity Generation 2024/25 is available for download. The Bundeskartellamt is legally required to publish a report on competitive conditions in electricity generation at least every two years, providing market participants with guidance on whether they may be considered dominant companies under § 18 GWB or Art. 102 TFEU, and thus subject to antitrust scrutiny.