The stage is set for competition in the field of environmentally friendly fuel.

The Competition Authority has today published a decision No. 33/2012 where it is reported that SORPA bs., Metan hf., Orkuveita Reykjavíkur and N1 hf. committed earlier this year to changing their business practices in the sale and distribution of methane gas and have submitted to rules that create the conditions for competition in the related markets.

The background to the case is that N1 hf. informed the Competition Authority of an agreement between N1 hf., SORPA bs., Metans hf. and Orkuveita Reykjavíkur which, among other things, dealt with the retail price of methane gas on the basis of the companies' agreement from 2007. The agreement constituted an infringement of the prohibition on collusion, as it provided for, among other things, the resale price of methane gas and its minimum retail price at N1's points of sale, formerly those of Olíufélagið hf.

As N1 Ltd. had taken the initiative to inform the Competition Authority of the existence of the agreement, the company fulfilled the conditions for a waiver of the fine, but the rules of the Competition Authority No. 890/2005 Provide for events leading to the cancellation of fines or decisions to reduce fines in cases concerning illegal collusion between undertakings.

The other companies followed suit, and the matter concluded with their settlement with the Competition Authority. They agreed to pay administrative fines totalling 9 million krónur and to be subject to conditions in their operations to stimulate competition, as previously stated.

It has been reported in the media that the number of competitors in the wholesale and retail market for methane gas is increasing. Thus, Olíuverzlun Íslands hf. intends to compete with N1 hf. in the retail sale of methane gas in the coming quarters, as the company has reached an agreement with Metanorku ehf. and Orkuveita Reykjavíkur for the purchase of methane gas. Importantly, the 2007 agreement is no longer in effect and the companies in question have adopted more suitable operating practices.