ERGEGERGEGCustomers’ Focus GroupCustomers’ Focus Group

Helsinki, 11-12 October 2005Helsinki, 11-12 October 2005

Chrissa ArgyriouChrissa ArgyriouEUROPEAN COMMISSIONEUROPEAN COMMISSIONDG Energy and TransportDG Energy and Transport

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2005 report (based on Electricity directive 2005 report (based on Electricity directive 2003/54/EC and Gas Directive 2003/55/EC)2003/54/EC and Gas Directive 2003/55/EC)

DG Competition sectoral inquiryDG Competition sectoral inquiry

Indicators on customers switchingIndicators on customers switching

OUTLINEOUTLINE

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The report shall, in particular, consider:The report shall, in particular, consider: non-discriminatory network accessnon-discriminatory network access effective regulationeffective regulation development of interconnection and development of interconnection and

security of supply situation security of supply situation benefits to small companies and benefits to small companies and

households households market dominance, market concentration market dominance, market concentration

and predatory or anti-competitive behaviourand predatory or anti-competitive behaviour

2005 report I2005 report I

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the extent to which customers are actually the extent to which customers are actually switching suppliers and renegotiating tariffsswitching suppliers and renegotiating tariffs

price developments, including supply pricesprice developments, including supply prices the experience gained in the application of the experience gained in the application of

the Directive as far as the effective the Directive as far as the effective independence of system operators in independence of system operators in vertically integrated undertakings is vertically integrated undertakings is concernedconcerned

2005 report II2005 report II

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What prompted the sectoral inquiry of What prompted the sectoral inquiry of DG Competition?DG Competition?

Prices!Prices!

Rising prices raise questions about Rising prices raise questions about competitive conditionscompetitive conditions

Concentration in generationConcentration in generationLow liquidity on exchangesLow liquidity on exchanges

Are there abuses of market power? Is Are there abuses of market power? Is there manipulation of power exchange there manipulation of power exchange prices?prices?

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QuestionnairesQuestionnaires

January - June 2005: January - June 2005:

consultation of regulators, competition consultation of regulators, competition authorities, market operators, usersauthorities, market operators, users

identification of issuesidentification of issues preparation of questionnaires preparation of questionnaires

Commission decision to launch the inquiry Commission decision to launch the inquiry in June in June

1800 questionnaires sent1800 questionnaires sent Analysis of responses underwayAnalysis of responses underway

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The processThe process WHO has been REQUESTED TO PROVIDE INFORMATION?WHO has been REQUESTED TO PROVIDE INFORMATION?

Electricity generatorsElectricity generators Suppliers and tradersSuppliers and traders Power exchanges, Brokers and trading Power exchanges, Brokers and trading

platformsplatforms TSOs, merchant lines, DSOsTSOs, merchant lines, DSOs Customers Customers Regulators and surveillance authoritiesRegulators and surveillance authorities

=> all issues are adressed by gathering the => all issues are adressed by gathering the facts and views of all concernedfacts and views of all concerned

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What is DG Competition studying?What is DG Competition studying?

Market conditionsMarket conditions Getting the facts rightGetting the facts right

Competition issuesCompetition issues Restrictive agreements, abusive behaviour and Restrictive agreements, abusive behaviour and

state measuresstate measures Remedies for structural problems Remedies for structural problems

Always taking into account the Always taking into account the regulatory framework, as it influences regulatory framework, as it influences market and competition conditionsmarket and competition conditions

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What should you expect?What should you expect?

Possibly more questions…Possibly more questions… Interim report – late autumn 2005 : Interim report – late autumn 2005 :

addressing some of the issuesaddressing some of the issues Final report 2006Final report 2006 Case investigations could be opened Case investigations could be opened

where appropriate (by Commission or where appropriate (by Commission or National Competition Authorities)National Competition Authorities)

Customer switchingCustomer switchingElectricityElectricity

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

FI SE UK

NO IT IE BE DE

HU

AT PO PT FR LT SI CZ

LU GR

DK

NL

EE LV CY M ES SK

% s

witc

hing

large and very large industrial small-medium industrial and busines

very small business and household

Customer switchingCustomer switchingGasGas

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

IE BE UK

ES HU IT FR AT LU SE SK SI PO NL

LV LT EE DK

DE

CZ

% s

witc

hing

large and very large industrial including power plantssmall-medium industrial and businesvery small business and household

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Customer switchingCustomer switching

Commission engaged a consultant to Commission engaged a consultant to investigate deeper the behaviour of investigate deeper the behaviour of companies companies

Graphs mixed pictureGraphs mixed pictureRegulated end-user tariffsRegulated end-user tariffs

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Possible actionsPossible actions

Best practices on customer protectionBest practices on customer protection

Compliance with Annex A Compliance with Annex A