38
Energy Energy Consommateurs Vulnerables OPME, Paris 3 Octobre 2014 Eero Ailio, Chef d‘unite adj, DG ENER B3
Energy
Energy
Consommateurs Vulnerables OPME, Paris 3 Octobre 2014
Eero Ailio, Chef d‘unite adj, DG ENER B3
Energy
24.8%
of Europeans at risk of poverty or social exclusion
Energy
Art 3 §7 Third Package
"Member States shall take appropriate measures to protect vulnerable customers, and shall, in par7cular ensure that there are adequate safeguards to protect vulnerable customers. In this context each Member State shall define the concept of vulnerable customers which may refer to energy poverty and inter alia to the prohibi7on of disconnec7on of electricity to such customers in cri7cal 7mes”
Energy
Common definiLon of vulnerability
– Stakeholders considered unfeasible
– SoluLons applied: • income tresholds /share of income needed to meet adequate energy requirements,
• Difficulty/inability to adequately heat the dwelling
• Consumer characterisLcs (age, disability, illness)
• 'Blanket' approach
– Energy poverty, fuel poverty
Energy
• Content
• Legisla0on: 3rd Energy Package, Energy Efficiency Direc0ve, ADR
• Work undertaken by DG ENER, DG SANCO and CEER
• Social and energy policy interac0on
• Key drivers and exacerbators of vulnerability
• Examples of Member State instruments and prac0ces
• Energy efficiency, hea0ng and cooling
• Funding mechanisms
• Enabling demand response
• Stakeholder recommenda0ons
Guidance Document on Vulnerable Consumers
Energy
Drivers of vulnerability Market CondiLons
Level of compe00on
Final energy price levels
Individual Circumstances
IT skills/ internet access
Income level Health and disability
Educa0on: literacy/ numeracy skills
Social/Natural Environment Living CondiLons
Under-‐occupancy Type of hea0ng system
Quality of housing stock
Climate State of economy
Energy
RecommendaLons
Source: Guidance Document on Vulnerable Consumers
Focus on long-‐term preven0on
Invest in energy efficiency measures
Empower consumers Social tariffs and
direct payments
role and interac0on of different
stakeholders
encourage more energy-‐
efficient behaviour
provide accessible informa0on
Empower consumers
Energy
What has driven electricity prices?
Source: Eurostat. Includes taxes in the case of households; excludes VAT and other recoverable taxes in the case of industry but other industry exemptions are not included (not available).
18.5%
30% 127%
36% 7.5%
-‐3% 17%
18%
Energy
Deficit at taxpayer's expense (e.g. 24 billion debts in Spain)
,
Price regulaLon below cost
Energy
RecommendaLons
– Review policy mix to ensure best combinaLon of social, energy, housing etc. Focus on long-‐term prevenLon over short-‐term support
– Invest in energy efficiency measures to reduce bills, improve health, generate employment and meet CO2 targets -‐>EED art 5(7), 7(7) (a)
– Targeted social tariffs and direct payments in preference to regulated prices for all household consumers. Direct payments may encourage energy-‐efficient behaviour
– Industry to provide accessible informaLon in different formats
– Empower consumers by demand response, energy advise etc. Improve the role/interacLon of stakeholders to beder address energy poverty
– Support to cover all energy sources (incl solids)
Energy
EED: Energy poverty, opportunity to prioriLze
EED Article 7(7)(a) Within the energy efficiency obligation scheme, Member States may: (a) include requirements with a social aim in the saving obligations they impose, including by requiring a share of energy efficiency measures to be implemented as a priority in households affected by energy poverty or in social housing (…).
• Policy choise: pay for renovaLon or pay for heaLng fuel? • Low co-‐ and prefinancing capacity • SoluLons to tenant-‐landlord dilemma • Awareness on individual consumpLon • Limited flexibility for some groups (illness, disabled) • Access to appropriate informaLon and payment opLons
Energy
Member State pracLces Vulnerable Consumer Guidance Document, Annex 5
Avoid (winter/summer)
disconnec0ons
Support with payment planning
Social tariffs and direct energy payments
Bills in different formats
Subsidies for energy
efficiency measures
Encourage landlords to
invest in housing stock
Fuel Poverty Observatory
NRA to monitor number of
disconnec0ons
Regula0on of selling methods
Energy
E.g. Social Housing, IncenLves for Tenants and Landlords
• Austria: mandatory energy performance certificate for buildings: https://www.help.gv.at/Portal.Node/hlpd/public/content/21/Seite.210400.html
• France: landlords invest in energy efficiency measures: http://www.legifrance.gouv.fr/affichTexte.do;jsessionid=0A586CCEA18474FBCAC71A910767A1AE.tpdjo12v_3?cidTexte=JORFTEXT000021327445&dateTexte=20110920
• UK: Landlord's Energy Saving Allowance: https://www.gov.uk/landlords-energy-saving-allowance
• The Netherlands: Covenant on Energy Saving in the Rental Housing Sector: http://www.iut.nu/members/Europe/West/2012/WoonbondEnergyConvenant28_juni_2012.pdf
Energy
• Follow-up to 2030 Climate and Energy Policy Framework
• Follow-up to European Energy Security Strategy
• Completion of the Internal Energy Market (wholesale, retail)
Energy policy big picture
Energy
2030 climate and energy Framework
20 % GHG
40 % GHG
20% RES 20 % EE
≥ 27 % RES
..2014
2020
2030 New Key Indicators
New governance system
Energy
Retail Market Design
• Consumer Choice, Protection and Control – Ease of Switching • Information Availability and Transparency • Price Forma0on and Composi0on
Market Functioning and Consumer Participation
• Effective and Efficient Competition • Open and efficient networks - incentives • Data Management and DSO Role(s)
Market Structure
• Role and Value of Flexibility and Demand Participation • Incentives for service and product innovation • Role of technology – smart meters and appliances
Demand-side Participation
Energy
Roll out of ELECTRICITY
smart metering by 2020
v 20 (21) CBAs, 16 MS: large-
scale roll-out
v ~ 72% EU consumers
v 195 million meters
v € 35 billion
Technology tools to markets: smart metering
Energy
18
50% follow recommended functionalities in the 16 Member States proceeding with large-‐scale smart metering roll-‐out by 2020
8 Member States (50% of those rolling-‐out) consider all
recommended func0onali0es
EU-‐28
Energy
Energy
Regulated consumer prices
Light permicng and grid connec0on procedures for self-‐produc0on
Protec0on of vulnerable consumers
Right to sell excess energy
Strong consumer protec0on
Easy access to technology such as smart meters or appliances
Secure access to more detailed energy consump0on data
Market-‐based consumer prices
Bill reflec0ng real instead of es0mated consump0on
Well-‐func0oning wholesale market
Protec0on against misleading selling methods and prac0ces
Independent and competent Na0onal Regulatory Authority
Easy access to demand response services
Easy access to energy efficiency services
Customer choice between compe0ng offers
Transparent contracts and bills
factors for beder energy management
Very important No opinion Unimportant
Energy
Energy
Energy
hdp://ec.europa.eu/energy/gas_electricity/forum_ciLzen_energy_en.htm
Thank you
Energy
EU 2020 => 2030 targets
Single Market by 2014
Technological progress
Energy Roadmap 2050: electricity share + 35-40%
EU 2030 Targets (proposed): RES 20% => 27%
Changing EU Energy Landscape
Energy
European Energy Security Strategy – follow-
up
Energy
What has driven gas prices?
17%
14% 12%
12%
Source: EC, Metadata Member States. Includes taxes in the case of households; excludes VAT and other recoverable taxes in the case of industry.
4.2%
2.7%
8.4%
-‐0,5%
Energy
Energy prices and costs report 2014
In the EU • Wholesale prices have been stable or low. • Retail prices have risen, ogen above
infla0on, mainly driven by taxes and levies and network costs.
Electricity -‐ households
Gas-‐ households
Electricity -‐ industry
Gas -‐ industry
Europe needs to contain energy costs to remain compe00ve.
Elsewhere
§ Prices have fallen (especially gas).
Annual rise in EU electricity and gas prices, 2008-‐2012
Energy
Rising Energy Costs Driven Mainly by Taxes, also Network Charges
Energy
Major naLonal variaLons in electricity prices…
Energy
ESC proposal
“The difficulty or inability to ensure adequate heaLng in the dwelling and to have access to other essenLal energy services at reasonable
price”
Energy
Customer sa0sfac0on with gas and electricity services is currently
below average
Energy
Need to Bring the Consumer Along Electricity
Postal se
rvices
Mortgages
Gas
Energy
Energy
Energy
EU Switching Rates Electricity Market 2012
EU Switching Rates Gas Market 2012
0,0
5,0
10,0
15,0
20,0
25,0
30,0
35,0
BE NL PT EE CZ IT SE DK UK FI IE ES SI SK LT AT PL DE RO FR HU LV LU BG HR
Percentage switching retailer
Percentage switching product/ services with the same provider
0,0
5,0
10,0
15,0
20,0
25,0
30,0
35,0
40,0
BE CZ NL UK IE BG PT SK IT SI ES AT DK LU DE FR PL HU RO LV HR EE EL
Percentage switching retailer
Percentage switching product/ services with the same provider
Energy 31
6 Ways Smart Metering benefits consumers
Energy Savings more accurate and frequent consumption data demonstrably help consumers reduce their consumption and save money
Energy Efficiency more detailed consumption measurements help consumers identify opportunities for energy efficiency improvements
Innovative Services smart meters are indispensable for smart home solutions/home automation, reducing energy costs
Consumer Empowerment
switching suppliers, modifying contractual terms, etc. becomes easier, faster and cheaper
Sustainability use of local renewable sources and storage potential (micro-grids), electromobility become easier
Distribution System Efficiency
management of the distribution systems becomes cheaper and more effective, leading to lower distribution costs
Energy
Consumer in the center
Consumers to have the choice and tools to ac0vely par0cipate in the market
Value from consumer ac0on should accrue to consumers
Consumers should feel secure
Energy
Retail market should evolve towards flexibility
Consumers' empowerment
New business models and dynamics
Transparent and accessible market
Efficient distribu0on networks
Energy
0,0
2,0
4,0
6,0
8,0
10,0
12,0
14,0
Bel
gium
Sw
eden
Net
herla
nds
Finl
and
Spa
in
Ger
man
y
Italy
Den
mar
k
Cze
ch R
epub
lic
Por
tuga
l
Fran
ce
Slo
veni
a
Aus
tria
Lith
uani
a
Slo
vak
Rep
ublic
Luxe
mbo
urg
Rom
ania
Pol
and
electricity
gas
Switching rates in some Member States in electricity and gas retail markets in 2010
Source: CEER database and national regulators
Nuanced picture: power of choice
Energy
2030 Framework: Key indicators
Energy price differenLals
Diversifica0on imports,
share of indigenous energy
Smart grids & connecLons between
Member States
Intra-‐EU coupling energy markets
Technological innovaLon
Compe00on and market concentra0on
Energy
Reduce Greenhouse Gas Emissions levels by 20%
Increase share of Renewables to 20%
Reductions in 2012: -18%
2020 Targets 2020
Projection
Share in 2011: 12.7%
2020 Projection
2020 Projection
Climate and energy: where do we stand?
Reduce energy consump0on by 20%
~ 16-20 %
Energy
Investment challenge
37
Total investment needs in the electricity and gas sector between 2010-‐20: over € 1 trillion
Power generaLon: ~ € 500 bn Transmission and distribu0on: ~ € 600 bn
DistribuLon: ~ € 400 bn
Transmission: ~ € 200 bn
Source: Commission calcula7ons
Renewables: ~ € 310-‐370 bn
Investments of over € 1 trillion will be needed by 2020 to replace obsolete power plants, to modernise and adapt infrastructure to the latest technologies and to cater for demand for low carbon energy.
Energy
• What's the problem?
• Insufficient of ineffec0ve compeLLon?
• Low level of consumer acLvity?
• Uptake of innovaLon behind poten0al?
