The voice of the energy industry

A new deal for energy consumers?

On 23-24 February, the European Commission organised its eighth annual Citizens’ Energy Forum, also known as the ‘London Forum’. Attendees included national ministries and regulators, consumer organisations (BEUC, Citizens’ Advice) as well as suppliers’ trade associations (Eurelectric, Eurogas and Energy UK).

Commissioner Věra Jourova opened the Forum by highlighting the Commission’s concerns around the lack of sufficient information on consumption and costs and the insufficient competition in many retail markets. The Commissioner’s speech, and several sessions of the Forum, referred to a (still to be published) Ipsos study on the functioning of retail electricity markets for consumers.

The Commission is adamant it wants policies to be evidenced-based, but what the Ipsos study and discussions during the Forum highlighted was the diversity across European retail energy markets. In one of the survey results, Ipsos highlighted that the first reason for not switching suppliers was because respondents were satisfied with their current supplier (42% of responses). Over 20% of respondents said they had never thought of switching, but instead of focusing on these disengaged consumers, the Commission seems to want to focus on the small amount of respondents who were concerned about the fees they might incur if they switched suppliers.

Energy poverty is another issue that is high on the Commission’s agenda this year: the definition of energy poverty and identification of indicators to be used across the EU is one of the key activities of the Commission’s Working Group Vulnerable Consumers. But again, the diversity of policies across Europe could mean Member States are reluctant to pursue this work at the EU-level. In the UK alone, there is no single definition of energy poverty, and England, Scotland and Wales all have their own approaches.

Since publishing its Retail Communication on the “New Deal for Energy Consumers” in July 2015, the Commission has been clear that it wants energy consumers to be empowered and more engaged. Outputs from the discussions from the London Forum and the continuous work of the Commission and its Working Groups should materialise in autumn 2016 with the publication of a package on the new market design. But many point out to the fact that one of the key issues in retail energy markets is the lack of implementation, including of the third package, dating back from 2009.

 

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