The Distributor Viewpoint to Supplier Switching Geode ERGEG Customer Focus Group Workshop October 11, 2005, Helsinki Pekka Salomaa

Geode: is a European independent association of energy distribution companies supports liberalisation of European energy market and creation of an internal energy market stands for creating competitive conditions permitting market players to have fair and non discriminatory access to energy member companies have strong geographical links to the distribution area –to offer best service quality to customers –an alternative for consumers in markets with very few players

Price transparency More transparency is better than less Price lists, offers, contracts, bills, websites, price comparisons by third parties A human’s ability to absorb information is limited –e.g. bills can’t be used for very extensive info

Switching procedures 1. Customer contacts –new supplier (NS) is the natural party for customer contacts –NS contacts distributor and NS / distributor contacts old supplier (termination of contract) Metering –shall be a responsibility of the distributor outsourcing is possible included in the network tariff / a separate part of it a neutral and stable party, to facilitate switching –AMR and hourly metering shall be developed rapidly ease of switch, grid load info, new supply products, real-time billing, enable increased price elasticity of demand and thus increased system reliability

Switching procedures 2. Data interchange –customer & point of use identification –data ownership & availability questions: who shall get which info and which not –distributor: info hub –customer’s supplier: access to info –incumbent supplier: no individual info

Consumer protection Leave room for new products, price and contract structures! Regulation of supply prices = no market! PSO’s: clear thinking is needed! What is really needed and by whom?

Which level of harmonisation? What is really needed to be harmonised Which needs exist –customer: balanced level of protection, easy and reliable procedures, products suitable for needs –system: cheap and simple –market: easy to switch, creating trust Not: Creating cost through regulation But: Finding best practices

Case study Finland An opinion poll June-August ,000 consumer interviews (domestic customers) Research interest: is there a need for an industry project on one bill for switched customers (incl. data exchange processes) 100 % eligible customers 11 % buy from other than incumbent 21 % been active within 24 months 8 % switched at least once within 24 months