Market Structure and Market Organisation in the Electricity and Gas Public Utility Sector of the Federal Republic of Germany

Abstract

The electricity and gas public utility sector of the FRG consists of a decentralised system of supply with a considerable degree of concentration of decision-making power. The titles to real estate (including that of the public road system) as well as to the economic resources, both of which are regulated by the civil law, form the legal basis of their supply activities. The owners are the public territorial authorities (states and cities, and, in the electricity sector, also the federal state), private subjects (individual persons and firms), as well as the so-called mixed companies which belong both to private and public owners. The public utilities are essentially free in their investment policy though the Energiewirtschaftsgesetz allows far-reaching government intervention which, however, has not occurred to any great extent. Regulation of investments, beyond certain minor measures of control, does not take place. It is true that the construction of oil and gas plants has been restricted in recent years. But this was not part of an overall control scheme in the electricity sector but was only intended to stabilise hard coal consumption in this sector.