First, they increased taxes: Now, the government will ensure lower gas prices for Danes

Prices at the country's gas stations are unacceptably high, and the losses are borne by consumers.

The government, which today presented measures to increase competition on the fuel market, believes so.

The government expects a household with two cars to save up to 2,000 DKK per year, under the condition that competition improves, and companies' earnings on fuel normalize to the level before 2020.

For a household with one car, savings are expected to be up to 700 DKK according to the government's calculations.

Although the industry organization FDM shares the view that price competition is poor, the organization is more skeptical about how much the government's measures will lower prices.

- They are somewhat soft measures, and it is also an expression that authorities have not been able to find the famous smoking gun. They have not been able to find any agreements between companies about having a fixed price, says Torben Kudsk Lund, political chief in FDM.

- So there is talk about measures that should try to give greater transparency for consumers, so we can navigate more easily. So time will tell if it can help to solve the market situation a little, he says.

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New requirements

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The government will increase competition by introducing requirements for gas stations to publish information online about local current pump prices.

This will make it easier for consumers to make a choice before they get in the car.

In addition, it will be forbidden for fuel companies to display leading prices, before changing the price of gasoline or diesel.

- We are not many years back, when there was competition, and where one could find different prices when driving around in one's own local area. But that can hardly be done today, and that is what is wrong, says business minister Morten Bødskov (S).

In January of this year, politicians increased energy and CO2 taxes at home. This means that a liter of diesel, for example, has increased by 67 øre in taxes per liter alone, so drivers now pay half of the diesel price in taxes and VAT, shows figures from the interest organization Drivkraft Danmark. It represents Danish fuel suppliers and fuel station operators.

Business minister Morten Bødskov denies that they have acted unethically.

- Even if you take taxes and VAT and other from, and look at the raw price, the reality is that Denmark also internationally and in Europe is at the top. It is yet another proof that there is a surplus in the companies that are very, very high, thinks the minister.

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'It is not unethical'

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The same tone is heard from his colleague, transport minister Thomas Danielsen (V).

- It is not unethical to advocate for competition. It would be very strange not to advocate for competition. When we note that there is a lack of competition on this area, so we are forced to react to it, says transport minister.

If you want the price to go down, why don't you just lower the tax?

- I want real prices and not artificially high prices.

But we know, when we look at electric cars, that cheaper electricity makes people drive more in electric cars. Cheaper diesel could also make people drive more in diesel or gasoline cars. Have you considered the climate costs of this here measure?

- Consistent prices give artificially high profits for companies, and we do not want consistent prices. We want competition. It has nothing to do with the fact that we naturally have to reach our climate goals. We are also doing that, says Thomas Danielsen.

So you have not considered the climate costs of this measure?

- It is not climate costs of significance that one ensures competition on the fuel market, says the minister.

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The government's measures

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* Here are the rules today:*

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Today there are only requirements for gas stations to display the actual pump prices physically on the gas station.

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This means that it is difficult for consumers to compare prices across local gas stations.

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At the same time, fuel companies can use leading prices to follow each other's prices.

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*This will be the case in the future:*

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It will become a requirement for gas stations to publish information online about local current pump prices.

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In this way, consumers can make a choice before they get in the car.

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At the same time, it will be forbidden for fuel companies to publish leading prices or future prices, which potential competitors could potentially adjust their prices after.Source: Business Ministry

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Organization: Competition is there

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At the interest organization Drivkraft Danmark, there is a somewhat different view of competition on the fuel market than the government and FDM.

Here, one sees the uniform prices as an expression of a sharp competition, "because everyone is very sharp on the price" in the fight for customers.

A sharp competition understood as the prices are as low as they can be, and therefore resemble each other, explains Michael Mügge Jensen, who is technical and environmental chief in Drivkraft Danmark

He will not comment on the government's calculations for how a household with two cars can save up to 2,000 DKK per year, under the condition that competition improves, and his members' earnings normalize to the level before 2020.

- That would presuppose that I know the individual companies' pricing strategy and how they incorporate their costs into the fuel price and out on the gas stations. And that would be in conflict with the competition law, if I in some way had knowledge of it, he says.

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