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2022 annual report focuses on the energy crisis and its impact

Photo of elecricity lines

The topics of the 2022 annual report of the Competition Authority are the energy crisis, the resulting increase in prices and inflation.

According to Evelin Pärn-Lee, Head of the Competition Authority, the energy crisis was not unexpected, but the concurrence of several unfavourable factors has significantly amplified it, which in turn led to price increases and inflation. ‘Countries have used various measures to improve the situation and reduce the price shock to consumers,’ Pärn-Lee said. ‘For example, one of the measures implemented in Estonia is the universal electricity service created in autumn 2022, which aims to ensure a stable and controllable monthly expense for household consumers. Such a measure, however, is clearly state interference in the market, as it restricts the freedom of choice of both the producer and consumer. In addition, exchange prices are generally lower in the long run than service prices set by the state. This raises the question – which measures can and should the state use in such a situation and when and to what extent is restricting freedom in the market justified.’

In addition to the energy crisis, the annual report addresses changes in energy markets and gives an overview of supervisory proceedings. The report also includes anti-competitive cases and the results of concentration control.

‘The Competition Authority is a joint authority that deals with both competition supervision and economic regulation,’ Pärn-Lee said. ‘Above all, however, the Competition Authority is an expert organisation whose clear mission is to ensure open markets and fair prices in Estonia.’

The Competition Authority exercises state supervision over competition, electricity, natural gas, district heating, mail, public water supply and sewerage as well as railways, aviation and ports.

The annual report is available on the website of the Competition Authority.