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2° european energy conference on consumers sustainable energy from the free market to the energy efficiency final
1. Vlaamse Regulator van de Elektriciteits- en Gasmarkt 1
Dirk Van Evercooren, Director Markets
VREG
18 June 2013
2° EUROPEAN ENERGY
CONFERENCE ON
CONSUMERS & SUSTAINABLE
ENERGY:
FROM THE FREE MARKET TO
ENERGY EFFICIENCY
2. Can I ask you a question?
What percentage of families and small and
medium sized business feel that the
liberalisation of the energy market is a good
thing for them as energy customers?
Less than 40%?
Between 40% and 70%?
More than 70%?
3. Did you know?
In a survey conducted with more than 1000 families last year
in Flanders/Belgium:
74% see the effect of liberalisation as positive for them
(up from 56% in 2011)
Young people are more positive (79%) than 55+ (69%)
Families that switched energy supplier have a more
positive attitude (80%) than those that contracted with the
default supplier (73%) or that are still passive (68%)
In a survey with more than 1000 small and medium
businesses in Flanders/Belgium
82% sees a positive effect (up from 66% in 2011) for them
6. Goals of liberalisation
Mean: introduce competition
Monopolies are not consumer friendly!
Expected effects of liberalisation:
Service
Price
Innovation
6
7. But:
Grid is a natural monopoly, so it is
not sensible to multiply parallel
infrastructures
Competition requires a ‘level playing
field’
To achieve this, we need ‘unbundling’:
splitting up monopoly activities and
competitive activities
7
8. After liberalisation of energy market
8
Production
Supply
Distribution
Transport
CPTE
Inter-
Municipalities
Competition
Before After
Competition
Monopoly
Monopoly
9. Level playing field?
Comptition needs a level battle field!
• Unbundling imposes equal treatment of
competing suppliers by grid operators
• But: not all competitors fight with equal
weapons!
• => (access to ) Production facilities
determined possibilities for competitors
• As a result, newcomers can have a
disadvantage in the battle…
9
10. What has been done in 10 years?
A lot has changed:
– in the industry: production, supply, grids,
lawyers, traders, consultancy,…
– Public authorities: (a lot of) new rules, control
by the regulators
Regulation of network tariffs
3 Generations of European Directives
More interconnections, Power and Gas
Exchanges,...
11. CEER 2020 Customer
Strategy
Putting customers first in the energy
market
Means giving consumers a voice
Consumer organisations can play a
very positive role, defending
customer rights and detecting flaws
in market functioning
Regulators should try to use this to
improve the regulatory process
12. HOW TO DEAL WITH THE
LIBERALISED MARKET AS
A CUSTOMER
13. Context for Customers
Energy price is now set by the
(international) market
Competition can mitigate an upward price
evolution, not reverse it
In many countries, what is gained on the
market, is ‘lost’ again in grid tariffs, due to
taxes, costs of public service obligations,…
But markets need corrections, so efficient
PSOs are needed…
14. Challenges for the market and for customers
Increasing decentralised production
Heat pumps
Electric vehicles
Smart meters
Smart grids – bi-directional grids
=> Growing electrification of energy
Flexible demand: domotics, Demand
Side Management,…
15. Energy Efficiency
Challenges in the Energy market are multiple
So end-user prices are not likely to come down
in the long run, even if competition keeps prices
low
So Electricity and Gas users need to ensure
they use energy efficiently and be active on the
market
In many countries, people get assistance:
(free) advice, financial support, subsidies, interest
free loans,…
More transparency will be instrumental – but in
16. Thank you for your attention!
www.vreg.be
dirk.vanevercooren@vreg.be