Retail Market Development in the Energy Community - First Results of an ECRB Survey -

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1 Retail Market Development in the Energy Community - First Results of an ECRB Survey - Edin Zametica, ECRB CRM WG Chair Advisor to the Commission (BIH-SERC) Vienna, 17 June 2014 Energy Community Regulatory Board 7th Energy Community Social Forum, Vienna, 17 June

2 Background ECRB Work Program 2014: Taking into consideration requirements of the Third Energy Package, ECRB will review features and performances of the Energy Community retail markets. This review will: Assess the electricity and gas retail markets, with a special emphasis on barriers to their effective operation Discuss the retail markets development status and provide recommendations on potential improvements Energy Community Regulatory Board 7th Energy Community Social Forum, Vienna, 17 June

3 Methodology and Scope Separate electricity and gas questionnaires including retail market development indicators and EUROSTAT templates for collecting energy prices circulated to the ECRB CRM WG members Deadline for completion 9th June 2014 Responses received from regulatory authorities of Croatia (for electricity), FYR of Macedonia, Kosovo*, Moldova(?), Montenegro and Serbia, initial inputs from Bosnia and Herzegovina To be done: Number of responses to be clarified Quality of responses to be proved Responses from other NRAs to be collected Analysis and preparation of report by the end of 2014 * This designation is without prejudice to positions on status, and is in line with UNSCR 1244 and the ICJ Opinion on the Kosovo declaration of independence. Energy Community Regulatory Board 7th Energy Community Social Forum, Vienna, 17 June

4 Electricity Consumption 30000,0 Total sale to final customers in 2013 (in GWh) Total number of customers in , , , , , , , , ,0 5000,0, , , ,0,0 consumption of nonhousehold customers consumption of household customers Number of nonhousehold customers Number of household customers Energy Community Regulatory Board 7th Energy Community Social Forum, Vienna, 17 June

5 Number and Market Shares of Electricity Suppliers Number of active electricity suppliers in 2013 Market share of the 3 largest companies in the retail market in % Estimated incumbent market share in the household market, in % of annual consumption Bosnia and Herzegovina ; 22.04; Croatia ; 45.49; FYR of Macedonia Kosovo* Montenegro 2? 100 Serbia 2 92; 7.4; Energy Community Regulatory Board 7th Energy Community Social Forum, Vienna, 17 June

6 Switching in Electricity Market No information provided for Croatia and Montenegro No switching in 2013 in FYR of Macedonia and Kosovo* Bosnia and Herzegovina: one customer, with 8% of total electricity consumption, changed supplier Serbia: Annual switching rate in the whole retail market (by number of eligible meter points): 11% Percentage of customers having changed supplier: 0,1% (26 customers), but they were forced by law to change supplier no switching per definition! Information on eligible customers available to the ECS Number of active eligible customers in the EnC: 47 (AL 7, BA 1, KS 0, MK 9, MD 1, ME 3, RS 26) Share of consumption of eligible customers in the total consumption: 1,82% Energy Community Regulatory Board 7th Energy Community Social Forum, Vienna, 17 June

7 in EUR cent/kwh Some Electricity Prices 16 Price of electricity charged to industrial end user (consumption band IC) Albania Bosnia & Herzegovina FYR of Macedonia Kosovo* Moldova Montenegro Serbia Ukraine EU-28 VAT and other taxes electrical energy and non-recoverable levies Source: EUROSTAT, NSI Pilot survey Information on industrial prices in the second semester of 2013 available to EUROSTAT (Directive 2008/92 obligatory in EnC CPs) Information on prices for households will be available in the ECRB report later this year Energy Community Regulatory Board 7th Energy Community Social Forum, Vienna, 17 June

8 Regulation of Electricity Prices (1/2) Application of regulated end user prices for households: Yes, in all EnC Contracting Parties, deadline for abandoning 1 January 2015 In Croatia all households can choose their own supplier, but they can use regulated prices if they want Application of regulated end user prices for nonhouseholds: Serbia and FYR of Macedonia: yes, for small enterprises by 1 January 2015 Other EnC Contracting Parties: yes, for all nonhouseholds, deadline for abandoning 1 January 2015 Croatia: no Energy Community Regulatory Board 7th Energy Community Social Forum, Vienna, 17 June

9 Regulation of Electricity Prices (2/2) Bosnia and Herzegovina Croatia FYR of Macedonia Kosovo* Montenegro Serbia Type of price regulation Cost plus Rate of return Revenue cap Revenue cap Cost plus Length of regulatory period Frequency of energy component updates (in months) Body responsible for setting regulated prices Is switching in and out of regulated prices allowed? Average price of procured energy in regulated price for households (in EUR/kWh) Lowest price of procured energy in the market offered to the household customers (in EUR/kWh) 1 year energy (HH) 6 months, network 1year n/a 6 n/a Once a year 1 year 1 year 3 year 1 year Up to 12 months NRAs NRA NRA NRA NRA NRA yes yes No (will be as of 1 Jan 2015) yes n/a yes for 1 tariff HH, for 2 tariffs HH n/a Yes, for HH and SMEs n/a n/a n/a n/a Energy Community Regulatory Board 7th Energy Community Social Forum, Vienna, 17 June

10 Gas Consumption So far information provided only by the Regulatory authorities of FYR of Macedonia and Serbia Total sale to final customers in 2013 (in GWh) Number of customers in 2013 households non- households households non- households FYR of Macedonia , Serbia 2,032 15, ,006 12,108 Energy Community Regulatory Board 7th Energy Community Social Forum, Vienna, 17 June

11 Number and Market Shares of Gas Suppliers FYR of Macedonia: Total number of active gas suppliers: 5 (3 DSOs also acting as suppliers and 2 companies selling gas to end-customers connected to transmission network) Serbia: Total number of active gas suppliers: 35 Number of active nationwide suppliers: 3 Market share of the 3 largest companies in the retail market (aggregated) in %: 82% (Srbijagas 64%, RST 14%, Novi Sad gas 3,5%) Number of foreign players in the country: 3 Estimated market share of foreign players in % of number of customers: 0,3% Estimated market share of foreign players in % of number of annual consumption: 19% Energy Community Regulatory Board 7th Energy Community Social Forum, Vienna, 17 June

12 Switching in Gas Market FYR of Macedonia: 4 eligible customers, one of them switched supplier in 2013 Serbia: In 2013, all customers (4.6% of eligible metering points and 88.5% of eligible volume) connected to the transmission system were declared to be eligible, but this is not switching according to the definition It is estimated that one customers changed supplier as per definition Energy Community Regulatory Board 7th Energy Community Social Forum, Vienna, 17 June

13 Regulation of Gas Prices FYR of Macedonia Serbia Application of end user price regulation households NO (Household consumers exist only in the region of Strumica where the DSO import scng from Bulgaria. NRA sets only the tariff for distribution and supply of natural gas (input price) and the DSO sets the retail price) YES (market will be opened for them as of 1 January 2015) non-households YES (As of 1 of October 2014, the gas market will be fully liberalized. NRA will only set retail price for supplier of last resort) YES, for those connected to distribution system (market will be opened for them as of 1 January 2015) Type of price regulation and length of reg. period Price cap, 5 years Rate of return, 1 year Frequency of energy component updates monthly If input price changes more than 3% the public supplier has to submit request for recalculation of prices Body responsible for setting regulated prices NRA NRA Energy Community Regulatory Board 7th Energy Community Social Forum, Vienna, 17 June

14 Thank you for your attention! Energy Community Regulatory Board 7th Energy Community Social Forum, Vienna, 17 June