Home Business & Finance Serious allegations against electricity providers – authorities target energy discounters

Serious allegations against electricity providers – authorities target energy discounters

Serious allegations against electricity providers - authorities target energy discounters

The energy discounters Stromio, Grünwelt and Gas.de have terminated the contracts of a number of customers. According to a report, the Federal Network Agency is now making serious allegations against the owner. According to a “Spiegel” report, after the cessation of deliveries and the cancellation of hundreds of thousands of electricity and gas customers by the energy discounters Stromio, Grünwelt and Gas.de, their managing director was targeted by the authorities.

As the news magazine reported on Friday, the Federal Network Agency is investigating the suspicion that the companies run by the alleged owner Ömer V. prefer to sell gas and electricity profitably to wholesalers instead of supplying their own end customers. Accordingly, this suspicion was expressed by market participants. According to the report, the owner of the providers, Callax Holding GmbH, is currently being audited in accordance with the Money Laundering Act. The holding is said to have made more than 300 million euros in profit between 2014 and 2019. According to the report, however, there are doubts about ownership.

Industry association sharply criticized low-cost providers

At the end of December, electricity provider Stromio, with its brands Stromio and Grünwelt Energie, stopped delivering without warning. Stromio had been “confronted with an unprecedented price explosion on the European energy trading centers for a few weeks,” the company explained on its website at the time. The company had advertised “electricity at a discount price”. The industry association BDEW had sharply criticized the procedure and spoke of a “serious regulatory gap”. He called for government intervention. Low-cost providers operated profiteering at the expense of customers, it said.

Some low-cost providers have had to give up because of high electricity prices

The energy discounters often buy electricity on the spot markets, where it is traded at short notice. However, energy prices have been rising significantly for months. This is a challenge for companies because they have long-term contracts with customers that include fixed prices.

You cannot pass the additional costs on to the customers. The delivery often became uneconomical, which is why suppliers terminated contracts or had to file for bankruptcy. In such a case, customers automatically slip into the replacement supply, i.e. they are initially supplied by the providers who have the most customers in a region. However, consumer advocates sharply criticized the basic suppliers because the tariffs for new customers are sometimes five times as expensive as for existing customers. Read more about the dispute here.

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