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Merger in the electricity sector cleared in Phase I

The Commission cleared in Phase I the merger of Sydkraft and Graninge, both active in the electricity sector in the Nordic market. We advised Sydkraft during the administrative procedure and met with Commission officials to discuss the economic issues raised by the merger. The market for electricity in the Nordic area is complex: while the various regional and national markets are linked to one another (and even to the rest of northern Europe) by interconnectors, they are not perfectly linked. Electricity is generated by many means but varies year on year with rainfall, as it is this that determines water levels in reservoirs and hence potential hydro-electric generation. Inter alia, the Commission used a (previously developed) model to simulate the merger's effects. Moreover there are extensive derivatives markets (options, futures, forward contracts, cfds) whose existence impinges on scope for unilateral action and for coordination.

For more information see Commission Decision

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