Statkraft on the Competition Authority's rejection of the Agder acquisition - A very serious situation.

Statkraft's ambitions
Statkraft's objective with the acquisition of ownership interests in Norwegian power companies is to contribute to the creation of market-oriented and rational solutions for the energy market. "With support from the Government and the Storting (Parliament) our task has been to position ourselves in relation to a Nordic and Northern European market. Based on Norwegian natural resources and cutting edge competence we have tried to build a good and effective national power alliance that will serve the customers. If the Competition Authority's decision is allowed to stand it appears that it will be difficult to realise this ambition", says Mikkelsen.

Will appeal
"Statkraft will appeal the Competition Authority's decision. We have faith in the authorities' handling of this appeal in an adequate and thorough manner. We believe we have good industrial grounds for claiming that the Agder acquisition does not impair competition. We must now carefully study the premises on which the decision is based and will seek a dialogue with the authorities in connection with the appeal", says Mikkelsen.

In the same way as other central authorities and regulatory bodies, Statkraft assumes that there is a Nordic market for the production and sale of electricity. It is in the context of the Nordic competitive situation that the Agder acquisition must be considered. Concentration in this market is unproblematic from a competition point of view. Even after the Agder acquisition, the Statkraft Alliance will have a market share of only about 14 per cent of the Nordic market.

The Competition Authority is concerned about temporary bottlenecks in the transmission network. Such bottlenecks exist only during a limited number of hours in a year, and Statnett believes that bottleneck periods in the transmission network will be reduced in the future as a result of distribution network developments. "There is no qualified evidence that this is a problem from a competition viewpoint", says Mikkelsen.

Statkraft has proposed measures
"Despite the fact that the Authority has not identified or quantified problems relating to the acquisition, Statkraft has proposed a number of remedial measures. It would appear that the Competition Authority has not adequately assessed these measures", says Mikkelsen.