implications of regulatory changes of the market model on the distribution business
TRANSCRIPT
Implications of regulatory changes of the market model on the distribution
business
Frankfurt (Germany), 6-9 June 2011
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Political ambition to achieve a common Nordic Retail Market
Creation of one single market out of four national markets (Sweden, Norway, Finland, Denmark)
An integrated market is assumed to be more efficient and a step towards an integreated European market
Main goal: to create an efficient, customer oriented market with a high degree of competition between suppliers
Lee Rud – Sweden – Session 6 – Paper 1293
Ambitions to create common Nordic Retail Market
Frankfurt (Germany), 6-9 June 2011
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Ensure neutrality of DSOs Low entry barriers for new suppliers
Possibility to operate in one country without establishing a subsidary Increase the power and influence of the customer Common procedures for key processes as supplier switching and
moving Be future proof – compliance with EU regulation and development
The new Nordic market model design should support the following
Lee Rud – Sweden – Session 6 – Paper 1293
Frankfurt (Germany), 6-9 June 2011
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Importance of the design of the customer interface
Essential part of market design Customer angle on market actors and processes Influences roles, responsibilities and processes for Suppliers
and DSOs
Lee Rud – Sweden – Session 6 – Paper 1293
Frankfurt (Germany), 6-9 June 2011
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Today the Nordic Market model is based on a dual point of contact model The customer has
two different interfaces to turn to regarding electricity related matters in Sweden
Present market model in Sweden
Lee Rud – Sweden – Session 6 – Paper 1293
End-user
• Contractand Billing
• Outage• Supplier Switch• Customer Service• …
• Contract and Billing• Supplier Switch• Customer Service• …
Energy consumptionMeter Values
Present Nordic Market Model
DSO
Supplier
= Energy consumption information= Non competitive operation= Competitive Business operation
Frankfurt (Germany), 6-9 June 2011
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Future market model
Lee Rud – Sweden – Session 6 – Paper 1293
Supplier
End-user
DSO
• Contract and billing (supply and DSO)
• Start & End of supply•Supplier Switch•Move in/Out
• Customer Service
Energy consumptionMeter Values
Supplier Centric Market Model
ContractSuppl/DSO
• New connection• Change of connection• Quality of delivery• Outage
Extended relation
= Energy consumption information= Non competitive operation= Competitive Business operation
Change towards a Supplier Centric customer model
More issues handled by Supplier instead of the DSO
The DSO is seen as a facilitator and the Supplier is given the main role towards the customer
Frankfurt (Germany), 6-9 June 2011
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Mandatory combined billing is preferable before voluntary combined billing The supplier should always invoice the customer
Transparency of network fees have large consequnces on the IT System set up
The need of harmonisation of network tariffs must be further investigated
Depending on model set up, cost savings possible for DSO in terms of IT system
Responsibility for billing is a crucial part of the model
Lee Rud – Sweden – Session 6 – Paper 1293
Frankfurt (Germany), 6-9 June 2011
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Billing and network tariffs Demand for customer service will change Challenge to operate an efficient DSO Customer Service for
DSO responsibility areas (eg. Outage Management) DSO customer communication
Strategic areas for the DSO
Lee Rud – Sweden – Session 6 – Paper 1293
Frankfurt (Germany), 6-9 June 2011
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Influence on allowed revenues on regulated markets Consequences for IT, HR, Customer Service resources and
competence IT strategies DSO communication strategies DSO contribution to customer energy efficiency
Distribution companies need be well prepared for changes and challenges in the future!
Further analysis of consequences of a new market model needed
Lee Rud – Sweden – Session 6 – Paper 1293
Frankfurt (Germany), 6-9 June 2011
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Thank you!
Lee Rud – Sweden – Session 6 – Paper 1293