Arbeitspapier

Market power and heterogeneous pass-through in German electricity retail

We analyze the pass-through of cost changes to retail tariffs in the German electricity market over the 2007 to 2014 period. We find an average pass-through rate of around 60%, which significantly varies with demand factors: while the pass-through rate to baseline tariffs, where firms have higher market power, is only 50%, it increases to 70% in the competitive segment of the market. Although the pass-through rate of independent firms is significantly higher than that of other firms in the competitive market segment, the extent of supply-side heterogeneity is limited. Thus, the firms' ability to exercise market power appears to be constrained by competition and largely determined by demand side factors. Finally, we find that the pass-through rate in the competitive market segment has been approaching unity over the past years, indicating a rise in competitive pressure.

Sprache
Englisch

Erschienen in
Series: DIW Discussion Papers ; No. 1614

Klassifikation
Wirtschaft
Single Equation Models; Single Variables: Panel Data Models; Spatio-temporal Models
Firm Behavior: Empirical Analysis
Market Structure, Pricing, and Design: Oligopoly and Other Forms of Market Imperfection
Oligopoly and Other Imperfect Markets
Electric Utilities
Energy: Demand and Supply; Prices
Thema
electricity retail
pass-through
Germany

Ereignis
Geistige Schöpfung
(wer)
Duso, Tomaso
Szücs, Florian
Ereignis
Veröffentlichung
(wer)
Deutsches Institut für Wirtschaftsforschung (DIW)
(wo)
Berlin
(wann)
2016

Handle
Letzte Aktualisierung
10.03.2025, 11:41 MEZ

Datenpartner

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Objekttyp

  • Arbeitspapier

Beteiligte

  • Duso, Tomaso
  • Szücs, Florian
  • Deutsches Institut für Wirtschaftsforschung (DIW)

Entstanden

  • 2016

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