Competition, consumers & affordable prices in liberalised energy markets J. Minor, European Commission, Director, Consumer Affairs IV World Forum on Energy.

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Presentation transcript:

Competition, consumers & affordable prices in liberalised energy markets J. Minor, European Commission, Director, Consumer Affairs IV World Forum on Energy Regulation, 20/10/2009

Why a Commission Service for Consumers? Single Market Review Reconnecting with citizens Evidence-based & outcome-oriented policies General market monitoring exercise EU Consumer Policy Strategy Better monitoring consumer markets and national consumer policies  Consumer Markets Scoreboard To empower EU consumers, with real choices, accurate information, market transparency, effective protection and solid rights; To enhance EU consumers‘ welfare, in terms of price, choice, quality, diversity, affordability and safety; To protect consumers effectively, by ensuring protection against risks and threats that cannot be left to individuals to deal with.

Consumer Markets Scoreboard Screening consumer markets 5 Top level indicators: complaints, prices, satisfaction, switching and safety  Identify malfunctioning markets for further in-depth analysis Integration of retail internal market Fragmentation, Cross border issues Cross border sales, information, complaints, disputes, enforcement, consumers and retailers attitudes towards cross border purchases Benchmarking the national environment Performance of national policies / instruments Enforcement & empowerment

2 nd Consumer Markets Scoreboard Markets that are not functioning well: energy, banking, transport (rail and bus) Findings based on satisfaction and switching surveys  comprehensive questionnaire, in-depth findings Follow-up study on retail electricity Tools to be used: Surveys, Mystery shopping, Stakeholder consultation Questions: Can consumers benefit from a well-functioning market in terms of price, choice and quality? Are consumers able to make informed, rational and empowered choices? Issues: Information and awareness, switching and comparability of offers, unfair commercial practices, billing, contract terms, dispute resolution Results will be published in Autumn 2010

Consumer empowerment in competitive energy markets: making markets accessible Competition: unknown territory for most individual consumers Consumer participation  empowerment Information: correct, concise, comparable Case in point: energy bills Citizens’ Energy Forum mandate: Commission led a Working Group on Billing Participation: ERGEG, consumers (ECCG sub-group on Energy), industry Focus: regular paper bills, annual reconciliation statement Deliverable: Recommendations, good practices  Commission created model bills

Competitive energy markets & affordability 1 1/3 EU consumers find electricity, gas and water too expensive (Eurostat) In some EU countries 1/3 consumers faced difficulties to keep houses warm (2006) Low income consumers have a budgetary need to 'pay as they go' – this has created higher bills in the past (UK) UK defined fuel poverty & published data: in 2008 more than 20% households fuel poor (>10% of income on energy), UK target: no fuel poor by Similar stories for “newer’’ EU Member States

EU law: "reasonable prices" for electricity & gas. Third Energy Package: Member States must define reasonable prices & who benefits from special treatment (social tariff or other) Commission to make sure that definition will not impact on competition Commission to facilitate dialogue, exchange of good practice, make sure that competition will not negatively affect consumer welfare Further input in the framework of Citizens’ Energy Forum Competitive energy markets & affordability 2

Information on Energy and Consumer Bills: Report by the Working Group on Billing: (click on 2 nd Citizens’ Energy Forum, Reports) Monitoring markets and the Consumer Markets Scoreboard Thank you for your attention!