Brussels, 27/05/2016 (Agence Europe) - In its recommendations on a “new energy deal for energy consumers”, drafted by Theresa Griffin (S&D, UK) and adopted by the wide margin of 577 votes to 65, with 9 abstentions in plenary session on Thursday 26 May, the European Parliament calls for a raft of measures to give consumers more power in the energy market in terms of both energy generation and energy prices.
More active role. To encourage consumers to play a more active role on the energy market, MEPs propose introducing new business models, such as collective purchasing schemes and innovative financial instruments to help consumers to generate more power themselves (“self-generation”) and use more of what they generate (“self-consumption”) in the most efficient way. They say that administrative barriers to new energy self-generation, shortening authorisation procedures and promoting community/cooperative energy schemes should be reduced to the strict minimum. In addition, they call for favourable conditions to be introduced for tenants and those living in apartment buildings to allow more use of self-generation and energy efficiency tools.
Clear pricing. The Griffin report includes a series of recommendations to make energy prices more transparent: - providing more frequent bills and easier to understand contracts; - enabling consumers to compare offers, even without internet access or skills, and ascertain whether they could save money by switching providers (such comparison tools need to be independent, up-to-date and easy to understand, informing customers of the most advantageous tariff for them, based on historic consumption patterns, and ensuring that they can change to that tariff, without any termination fee or penalty); - developing dynamic pricing, reflecting peak and off-peak periods of energy consumption, and transparent, comparable and clearly explained tariffs; - providing easy and timely access to the consumption data and related costs; - developing smart grids and appliances that automate energy demand management in response to price signals.
Energy poverty. Lastly, MEPs call for the root causes of energy poverty to be tackled. The Griffin report calls for a common definition of energy poverty based on the premise that access to affordable energy is a fundamental social right and it calls on the Commission to prepare an action plan to tackle energy poverty by 2017. MEPs call for the funding allocated by the EU for energy efficiency and support for self-generation to focus better on energy-poor, low-income consumers. They argue for well-targeted social tariffs low-income, vulnerable citizens.
Commission proposals in September. These recommendations will inform the next legislative proposals on energy union which the Commission is due to bring forward in the second half of this year. In the energy union package of summer 2015 (see EUROPE 11360), the Commission set out avenues for increasing the power of consumers through a “new deal” based on a three-pillar strategy: “helping consumers save money and energy through better information, giving consumers a wider choice of action when choosing their participation at energy markets and maintaining the highest level of consumer protection” (see EUROPE 11358).
Addressing the plenary on the eve of the vote, Energy Union Commissioner Maros Sefcovic announced legislative proposals for September on energy efficiency and market design which will be followed by a legislative proposal on renewable energy sources, a report on energy prices and proposals in 2018 for an energy poverty observatory.
Ending “sleeping contracts”. “Over 50 million EU citizens are living in energy poverty. Millions … are being kept on outdated energy contracts, also known as 'sleeping contracts', which often require large termination fees when switching to a cheaper supplier. … we are calling for the end of termination fees so that consumers can switch to a cheaper supplier without cost. In Europe in 2016, no one should have to choose between heating and eating”, said Griffin, calling on energy regulators to work with energy suppliers and price comparison organisations to deliver information direct to customers.
Strong approach to address with energy poverty. A “strong and comprehensive approach” to energy poverty needs to be developed, supporting strategies put in place by member states to tackle the problem, identifying best practice and supporting information exchange, said Dan Nica (SD&D, Romania). He called for a database of national measures on protecting vulnerable customers and energy poverty. Energy poverty is a complex issue needing targeted consumer-protection measures on which regulatory authorities and energy companies could play a key role, he stated. (Original version on French by Emmanuel Hagry)