Market opening on 1st July 2007 – energy customers’ rights
Since 1st July 2007, household consumers all over Europe have the right to choose their electricity and gas supplier. Some countries had already opened their energy markets in full (i.e. including to households), others have specific derogations (e.g. Portugal for gas) and 14 countries have on 1 July 2007 opened their residential energy markets. The 14 countries who now also allow households to choose their supplier are Bulgaria, Estonia, France, Greece, Hungary, Italy, Latvia, Lithuania, Luxembourg, Poland, Romania, Slovakia, Slovenia and Sweden. Market opening in itself cannnot guarantee a sufficient degree of supplier choice and competition. ERGEG and the European Commission continue their efforts to further enhance market integration (see Regional Initiatives section) and introduce effective unbundling so as to bring fair and dynamic competition to Europe's energy consumers.
Consumers too have a key role in stimulating competition by shopping around for the best value, and exercising their right to choose their supplier. The European Commission, with ERGEG's suppport, has launched a customer awareness campaign to explain to energy customers their rights, so that they can make informed decisions in choosing their energy supplier. Visit the new website http://www.agathepower.eu/ for information on energy consumers right and market opening in (multiple languages) in each Member State. Some basic energy consumer rights include: Supply of electricity and gas: - All customers - including vulnerable ones - have the right to access electricity and gas without discrimination ; - All consumers are entitled to choose their own energy suppliers and be able to switch supplier free of charge; there is no risk in changing supplier - Suppliers are obliged to ensure safe and reliable supplies of electricity and gas of a defined quality.
Information: - Customers must be informed of who supplies them with electricity and gas; - They also have the right to know how the electricity supplied to them is produced (composition of the fuel mix); - There should be a wide choice of methods for the payment of the bill.
Protection: - To avoid dishonest practices or misleading advertisements, suppliers must pass on information (e.g. conditions of contracts applicable tariffs) to their clients and must offer an after sales service.; - Customers have the right to redress mechanisms with prompt settlement, to compensation and reimbursement claim and to have their collective interests as consumers represented.
Other recent ERGEG reports on customer issues:
ERGEG Position Paper on Smart Metering with a Focus on Electricity Regulation - October 2007
Starting with the analysis of existing or planned smart metering schemes and discussions carried out in the past months, this document (E07-RMF-04-03) lists some main recommendations for regulators and some policy options adoptable by them, according to both types of metering frameworks established in EU Member States: regulated and liberalised.
Due to the country-specific role of regulators with regard to metering arrangements, some of the results of this report might not be relevant to all regulators or applicable to the individual Member States. The powers and responsibilities of the national regulatory agencies differ from country to country as does the situation regarding both metering and market opening. It is therefore difficult to draw general conclusions which are fully applicable to all countries.
ERGEG's reponse to the EC's public consultation "Towards a European Charter of the Rights of Energy Consumers"- September 2007
The ERGEG's response to the European Commission’s public consultation document "Towards a European Charter of the Rights of Energy Consumers", welcomes the Commission's initiative to address the need for effective consumer protection in the electricity and gas markets. It is imperative to focus on the legislative, technical and administrative structures that are needed in order to allow consumers to actively participate to the energy market. ERGEG supports the Commission’s initiative to present key goals in a short and comprehensible document. ERGEG believes the Charter should specify its aims, status and target group as well as provide basic information on electricity and gas markets for consumers. The ERGEG recommendations to the Charter seek to clarify and complement the scope and definition on the issues such as the protection of vulnerable customers, the energy bills, supplier switching.
ERGEG Position Paper on End-user Price Regulation - July 2007
Following the publication of a review of end-user price regulation among EU Member States, the Regulators published their Position Paper (E07-CPR-10-03) with the following messages:
a) Regulated end-user energy prices markets distorts the functioning of the market and jeopardises both security of supply and the efforts to fight climate change. Therefore end-user price regulation should be abolished.
b) Protecting “vulnerable customers” remains necessary in a competitive market but the protection of “vulnerable customers” should not be confused with maintaining regulated prices for all (or certain categories of) customers.The tools used for the protection of vulnerable customers must work in line with and support the pre-requisites of open, competitive markets.
c) Transition periods towards well functioning competition (for the co-existence of regulated and market prices) may be necessary to protect customers from potential abuses of dominant positions. It is essential that countries in a transition period draw up an individual road map. ERGEG calls on Member States to rapidly remove regulated prices and to outline (by 1 July 2008) a roadmap towards competitive markets by removing regulated prices.
d) Even in Member States where there is only one supplier, ERGEG urges the Member State governments and regulators to act rapidly so as to create an environment to attract the new entry of suppliers by removing regulated end-user prices.
ERGEG Status Review on End-user Price Regulation- June 2007
ERGEG has reviewed the status of end-user price regulation for electricity and natural gas in EU27. The survey assess the effects of Member States' maintaining regulated energy prices on market functioning. ERGEG has found that state regulated end-uers prices continue to co-exist with market prices in many countries (9 for gas, 17 for electricity). More than 80% of eligible customer choose to stay on the regulated prices, indicating a serious lack of competitoin in the retail market in these countries. For example in Spain and France, where eligible customers can opt to stay on regulated prices set by government, 54% of small business customers were still supplied by their local default supplier (on regulated tariffs), and in the case of France it was 89%. ERGEG considers end-user prices to be distortionary and calls on Member States to abolish them.
GGP and Status Review - Obstacles to switching in the gas retail market - April 2007
This set of Guidelines for Good Practice and Status Review present additional recommendations to the three sets of BPPs (see below) that ERGEG presented in 2006. They bring forward practical rules for market opening, customer and supplier information and supplier switching that aim at increasing liquidity and facilitating supplier switching in the gas retail market.
ERGEG Customer Information Handbook - December 2006
In the framework of the opening of residential electricity and natural gas markets for all European countries from 1 July 2007, the ERGEG carried out a survey on Pre-Contractual Information (PCI). The main results of this survey can be found in this Handbook. The Handbook puts forward good practices (such as tariff calculators) for customers from the experience of regulators in countries that had already opened their residential market to competition.
- A review of good practices, 6 December 2006 (Ref. E06-CPR-04-03)
ERGEG Best Practice Propositions on Customer Issues - July 2006
ERGEG, following a public consultation process, has issued three Best Practice Propositions whose purpose is to assist with the practical implementation of the Electricity (2003/54/EC) and Natural Gas (2003/55/EC) Directives by energy companies. The propositions deal with switching supplier, customer protection and transparency of prices.
