German utility E.ON AG (EOA.XE) will raise wholesale gas prices for municipal utilities and gas suppliers this year in light of soaring oil prices, Associated Press reported at the weekend.
E.ON spokesman Jens Schreiber tells Associated Press its subsidiary E.ON Ruhrgas felt the impact of rising energy prices in the first quarter of the year but didn't pass the costs on to consumers.
Schreiber didn't specify when the hikes will come into effect or the extent of the increases, but various German publications over the weekend did quantify the rises.
The latest edition of Der Spiegel magazine reports that E.ON intends to raise prices by up to 25% but hasn't yet decided when the hikes will be implemented or whether they will be in a one or two stages. The report cites internal planning information.
According to Bild am Sonntag, the weekend edition of the daily newspaper, 67 German gas distributors plan to raise their prices by up to 19% as of June 1 and July 1.
On Monday, regional daily Rheinische Post reports that E.ON subsidiary E.ON Ruhrgas will raise gas prices at least 20% as of July 1, due to high gas prices on the spot market, citing company sources. The newspaper also reports E.ON Ruhrgas expects earnings to take a hit in first quarter 2008.
However, utilities may find it difficult to push the price hikes through, as German Economics Minister Michael Glos has announced measures to strengthen control of energy companies in light of rising gas prices, according to a report in Bild am Sonntag.
Glos is quoted as saying the government will "very accurately control the purchase prices of energy companies" and will have to "explain every cent of such a hike to the Competition office."