Many EU energy consumers are now beginning to harness the benefits of the single energy market through the decrease in energy prices, the EU Agency for the Cooperation of Energy Regulators (ACER) said.
The average household gas bill decreased by 4.2% in 2015, compared to the previous year, according to the latest Market Monitoring Report presented in Brussels by the ACER and the Council of European Energy Regulators (CEER).
“The downward trend of wholesale prices observed in many countries over the last few years is finally reflected in the energy bills of industrial customers and in the gas bills of domestic consumers” ACER said.
“In 2015, wholesale gas prices decreased across Europe, as a result of declining oil prices, increased gas-to-gas competition and a greater availability of LNG” commented ACER’s director Alberto Pototschnig.
“Electricity wholesale prices also continued their declining trend in many countries and remained below 2008 levels” he stressed, adding that “this trend is due, at least in part, to more renewables and an overcapacity in generation.”
“Both for gas and electricity, a better utilisation of the networks, as well as greater competition, have played an important role”.
Subsidies costs lift electricity prices
However, electricity retail prices have not followed a similar path to gas prices, as “in half the EU Member States, the price residential consumers pay for electricity has not fallen” ACER noted.
That's mostly due to “an increase in the level of non-contestable charges in the consumers’ energy bills” such as those elated to the funding of renewables support schemes and, in some cases, capacity remuneration mechanisms and other system services, the agency said.
“Regulators consider that the continued increase of these non-energy related charges in consumers’ energy bills hinders consumers’ ability to take advantage of the greater choice and better prices that the energy sector liberalisation is expected to deliver” it added.
Consumer protection consolidates
Looking at consumer protection, the Report found that legal provisions “are generally well established in national legislation and in practice” across the EU.
On average, it takes around 14 working days to switch (electricity or gas) supplier” which is within the 3-week maximum period mandated by EU energy laws,” and around 5 weeks to receive the final bill after switching supplier, ACER said, adding that regulators “have set a more ambitious goal of switching within 24 hours by the year 2025.”
“Consumers’ empowerment is essential if consumers are to benefit from the greater choice available in the market” commented the chair of ACER”s board of regulators and CEER president, Lord Mogg.
“Smart meters, if they are equipped with proper functionalities, are a key enabler of demand response which in turn provides much needed flexibility in energy systems” he said, adding that “as regulators we will continue our work to remove barriers to retail markets, to unlock demand response and to ensure consumers have access to reliable comparison tools.”