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Last Updated: Thursday, 16 February 2006, 22:58 GMT
Energy firms 'holding back gas'
Gas ring on cooker
Gas bills in the UK have risen 40% since 2004
Some of Europe's biggest energy firms are holding back gas supplies, stifling competition and driving up prices, the European Commission has found.

The findings of an investigation into the gas and electricity sectors have prompted Brussels to launch a crackdown on anti-competitive behaviour.

Without naming companies at this stage, EU competition boss Neelie Kroes said a number now faced separate probes.

She urged firms to look at their own practices and make necessary changes.

Individual probes

The probe, which started last summer, looked at whether energy firms on the continent had colluded to keep prices high.

Where the report has found evidence of market abuse, we welcome the Commission's commitment to pursue such cases urgently and vigorously
Ofgem chairman Sir John Mogg

"In the coming weeks and months, the Commission will launch individual anti-trust investigations," she said.

"We are just at the beginning of a period of more intensive anti-trust enforcement.

"I can only encourage everyone to take a close look at their practices. Prevention is always better than cure."

Ofgem support

The crackdown was welcomed by the UK energy sector, which has blamed recent price hikes - particularly for natural gas - on a lack of competition in the continental markets.

"Today, Commissioner Kroes outlined for the first time the barriers preventing a truly competitive European energy market emerging and spelt out how much this harmed European customers and competitiveness," said Sir John Mogg, chairman of UK energy regulator Ofgem.

"The Commission's detailed report provides hard-hitting analysis that will justify clearly the urgent action needed to deliver a competitive European energy market."

He promised Ofgem's "full support" in the forthcoming investigations.

"Where the report has found evidence of market abuse, we welcome the Commission's commitment to pursue such cases urgently and vigorously," he added.

"This will send a clear signal to all European energy companies that such behaviour will not be tolerated."

Gas bills

The issue of gas prices has particularly focused the UK's attention on the continental European energy market in recent months.

UK gas bills have risen by more than 40% in the last two years.

And excess prices are thought to have cost British consumers 1bn over the winter.

As Britain now imports much of its supplies from the continent, the UK's energy suppliers have blamed the bill rises on higher wholesale prices in Europe, saying they have simply had to pass on some of the costs to consumers.

Find out how European firms are pushing up UK gas prices

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