A regional court in Brno has confirmed a 40 million crown fine on energy company RWE for abuse of its dominant position. The case goes back 10 years when a fine was imposed on the German-based company by the Czech competition office for giving preferential terms to its gas distribution companies. The fine was later cut by the office from the original 240 million crowns. RWE can still launch a last ditch appeal at the Supreme Administrative Court.
Leaders of the government coalition parties on Monday will debate the thorny question of how to rebalance the costs of electricity supply between different categories of Czech households and businesses. An outline proposal for changes from the national energy regulator has resulted in an avalanche of criticism with one option now to go back to the drawing board.
The Czech Republic’s biggest retailer of natural gas, RWE Czech Republic, said on Wednesday that it had halted the erosion of its customer base last year. RWE said it increased gas sales to 37.6 TWh from 37.0 TWh and attracted back customers with new offers. The company announced a profit of 10.5 billion crowns on turnover of 53.6 billion crowns, though the results are not comparable with previous years because of the sale of its gas pipeline company NET4GAS and other changes. It made a loss of around 16.7 billion in 2012. The company said it is consolidating its position as the biggest alternative electricity supplier by attracting a quarter of all the customers switching suppliers last year.
In Business News this week: Russia’s Rosneft signs deal to deliver crude oil to Czech Republic; political instability could delay announcement of Temelín tender winner; poll suggest only quarter of Czech businesspeople want euro; domestic banks “stable and resilient” says CNB; and truck-maker Avia to close Czech factory.
This week in business: PepsiCo may sell its Central European division to Karlovy Vary Mineral Waters; electricity prices will rise next year, partially thanks to a new government proposal; the Czech Confederation of Industry publishes a bleak outlook for Czech businesses; a new computer system that would detect rigged public tenders is undergoing testing; RWE Transgas will not have to pay major fines to Russia’s Gazprom; the Czech potato harvest is down this season with uncertain consequences on consumer prices.
The Czech RWE Transgas utilities company has won a landmark case against the Russian Gazprom gas exporter over the “take-or-pay” clause in the two companies’ gas importing contracts. The “take-or-pay” clause that Gazprom has in most of their contracts stipulates that customers must buy a minimum amount of gas or pay fines. The arbitration court in Vienna ruled that RWE does not have to pay the 500 thousand US dollars Gazprom wants for their failure to pay take-or-pay fines in the years 2008-2011. This decision may prompt other dissatisfied European customers of Gazprom to challenge the take-or-pay claims from the Russian gas giant.