Joint ownership of production facilities in Sweden: A cause for competition concern?

Joint ownership of production plants is a common feature of electricity markets in general. E.g., in Sweden the nuclear plants are, in different constellations, predominantly owned and controlled by the three largest electricity producers; Vattenfall, E.ON and Fortum, i.e., by the three major rivals that should be competing vigorously in the electricity market. The electricity wholesale market is also an oligopolistic market, with relatively inelastic demand, making the market susceptible to the exercise of market power. In this paper we elaborate on the potential competition problems and associated risks that can arise due to the joint ownership of nuclear plants. We conclude that, also without actual infringements of the competition rules, there are still major competition concerns associated with the joint ownership of production facilities among competing firms. Thus, the existing joint ownership should be disbanded, or at least as far as possible limited, and any similar ownership constellations proposed in the future prohibited.