Annual Report 2007 Annual Report 2007 Federal Network Agency for Electricity, Gas, Telecommunications, Post and Railway 2 FEDERAL NETWORK AGENCY ANNUAL REPORT 2007
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Annual Report 2007 Annual Report 2007 Federal Network Agency for Electricity, Gas, Telecommunications, Post and Railway 2 FEDERAL NETWORK AGENCY ANNUAL REPORT 2007 10 26 Ten years of competition Consumer protection and advice in network industries Contents President's message 4 Organisation chart 8 Ten years of competition in network industries 10 Consumer protection and advice 26 Consumer Advice service 28 Universal service 33 Special control of anti-competitive practices 35 Dispute resolution 45 International cooperation 48 Telecommunications 50 Post 54 Energy 56 Railway 59 Telecoms 62 Market watch 64 Ruling chamber decisions 88 Further decisions 96 Administrative court proceedings 115 CONTENTS 3 48 62 122 140 179 International Telecoms Post Electricity and gas Railway Cooperation Post 122 Market watch 124 Ruling chamber decisions 135 Administrative court proceedings 138 Electricity and gas 140 Market development 142 Activities and proceedings 147 Court proceedings 171 Railway 176 Market watch 178 Activities and proceedings 183 Court proceedings 191 Agency’s functions, structure and core tasks 194 Mission statement 198 Strategic plan 2008 200 List of abbreviations 220 Contact points 232 4 FEDERAL NETWORK AGENCY ANNUAL REPORT 2007 President’s message The Annual Report this year appears ten years after the regulatory authority, now the Federal Network Agency, was set up. This is an occasion to look back not just on the past year but on the past ten years, and to take stock. If the liberalisation outcomes in the five markets of telecommunica- tions, post, electricity, gas and rail are different, this is, of course, not just or not primarily as a result of the Agency's work but because of the different times the markets were opened and the specific entry barriers for new competitors. Objective analyses and fair comparisons should thus illuminate the market structures and environments as a whole. In the late 90s technological change, willingness to invest in infra- structure and an open market entry model in telecommunications created a favourable scenario that is now delivering – after ten years – significant success. If, in the postal sector, the main part of the letter market was required by law to be operated as a monopoly until the end of 2007, similar success in achieving competition is simply not possible. The energy market is also a good example of how a quasi two-stage market opening has had disadvantages; domestic customers have benefited little from the fruits of competition and the model of "nego- tiated" access was unsuitable and has wasted time. But the energy mar- ket also shows that it is not just network access and use of system char- ges that represent entry barriers. For instance, the situation as regards the procurement of electricity and gas, the building of power plants and the installation of transmission lines all contribute to making it more difficult to spur competition in the energy than in the telecom- munications market. In the energy markets, opening the networks is indeed a basic, but not a sufficient, condition for achieving our goals. PRESIDENT’S MESSAGE 5 We also have light and shade in the rail market, where we see the extent to which the outcome of the current debate on the legal frame- work will ultimately determine competitive opportunity. The Agency is fulfilling its mandate purposefully and with commit- ment. But it cannot achieve more than is allowed by the political consensus that finds expression in the law. Ten years, however, have provided us with good experience of the bene- fits that open, competition-oriented markets deliver to consumers and customers. Also, the innovation dynamic that they trigger, the creativi- ty that is mobilised on the periphery and the efficiency gains and lower prices that they make possible are not theoretical claims; they are demonstrated in the Report by facts and figures. We would have to look hard to find a product that five million German households have additionally ordered within the space of just one year. But exactly this was the case last year with broadband access. A unique- ly competitive environment and steadily falling prices have enabled this unprecedented growth in Europe. But it is not just the telecommunications networks and the changes they have undergone, but also the new offers and the content carried over them that are strong drivers of growth, investment and jobs. 6 FEDERAL NETWORK AGENCY ANNUAL REPORT 2007 Online trading, search engines, the distribution of videos, films and music on the Internet are changing how we live and how we consume, and are also creating new production and work structures. All this requires open, low cost distribution channels in the networks. Many believe that the situation is exactly the opposite with gas and electricity; here, consumption should fall rather than rise as we are all looking to save energy and there is little innovation dynamic. Of course, given the scarcity of primary energy, given climate change and the promotion of renewable energy sources, we are faced with quite different challenges. But who says that competition instruments cannot be as effective here as they are in other markets in achieving the goals? It is precisely the diversity and decentralisation of energy production and consumption that calls for innovation and creativity. The grid is a determining factor in this. The informed and discerning consumer, who is meanwhile switching supplier more and more often, is the yardstick for the Agency. Only when the grid is able to respond to the ever more complex challenges posed by wind energy, trading and fluctuating demand will it be possi- ble to maintain stability and security of supply in the energy market. PRESIDENT’S MESSAGE 7 The Agency's role is becoming more, not less, important. It is the go- between in a market whose issues are politically and socially controver- sial. The list of aims – competition, consumer protection, job security, safeguarding employee interests, protection of the environment, cli- mate protection and long term security of supply – is longer than in other markets. It is our job to see that one does not rule out another in practice. Conflict such as that experienced in installing lines and build- ing power plants must therefore be acknowledged and not swept under the carpet. Yet solutions cannot be found by the Agency alone. Transparency of facts, resolving issues by dialogue, credibility in rela- tion to those in the political arena and the business community are important principles in our work, and must remain so. This is the basis on which we want to shape the future. We cannot carry over everything from the past; however, all those who are familiar with the network and competition sets of instruments and who have ana- lysed the technical and economic structures will also be able to develop consistent, long term strategies and to overcome existing problems. Matthias Kurth President 8 FEDERAL NETWORK AGENCY ANNUAL REPORT 2007 Federal Network Agency for Electricity, Gas, Telecommunications, Post and Railway General Staff Council President Staff Council General Spokesperson for Disabled Persons Spokesperson for Disabled Persons Data Protection Commissioner Vice President Vice President Ruling Chamber 1 Z IS 1 2 President`s Chamber Equal Business Support Information Technology Telecommunications Legal Market Definition and Opportunities and Regulatory Telecommunications Market Analysis Commission Security Economics Regulation Issues under Sections 10 ff TKG Frequency Regulation Ruling Chamber 2 Regulation of Telecommunications Retail Markets (Markets 1 – 7*, Broadband Services, Mobile) Z 1 Z 2 Regulation of Wholesale Leased Lines (Markets 13, 14)* Subscriber Data, Organisation General Legal Affairs Collection Services, Porting Personnel Finances Controlling Ruling Chamber 3 Regulation of Telecommunications, IS 11 111 211 220 Wholesale Markets, Z 11 Z 21 Fixed and Mobile Information Technology Telecommunications Legal Issues Technical and Regulatory Issues of Organisation General Legal Affairs Regulatory Sector-Specific Control of Efficient and Interference-free Use (Markets 8 – 12, 15 – 18)* Occupational Health and Safety Part 7 TKG Legal Issues Economic Policy Issues Anti-Competitive Practices of Frequencies Data Protection Telecoms Administrative Offences Ruling Chamber 4 IS 12 112 212 221 Individual Use of System Z 12 Z 22 IT Solutions Development Market Watch Spectrum Management Radio Frequency Charges Electricity, Telecommunications Procedures, Market and Utilisation Concepts Pipe to Pipe Competition Gas Policy, Personnel Representation Tariff and Contribution Legislation, Senior and Upper Charges Legislation Competition Aspects International Affairs Grade Service Staff, Special Unit Collection Services Frequency Usage Planning Further Training Innovative Radio Applications IS 13 113 213 222 Ruling Chamber 5 Z 13 Z 24 Workflow Structuring Business Management Frequency Award and Broadcasting Rates Regulation and Medium and Basic Grade Service Budget and Modelling and Accounting Issues Assignment Policy Special Control of Staff, Salaries, Remuneration, Budgeting Cost Accounting Telecoms Anti-Competitive Practices Tavel and Relocation Expenses Tax Matters Examination of Postal Markets Personnel Management Rate Proposals IS 14 114 214 223 Z 14 Z 25 Ruling Chamber 6 Information Requests Internet Economy Determination of Satellite Services, Fixed Services Buildings, Purchasing Civil Defence Frequency Requirements below 30 MHZ, Short Term Usage, Frequency