Transcript CONSUMER PROTECTION & SWITCHING IN THE DOMESTIC GAS MARKET Eurogas

Eurogas
CONSUMER PROTECTION &
SWITCHING IN THE DOMESTIC GAS
MARKET
ERGEG Customer Focus Group Workshop
Helsinki
11th October 2005
Introduction
Eurogas represents the interests of the natural gas
industry in 21 countries. Membership is open to national
federations and individual gas companies.
Spring 2002:
Gas Suppliers’ Group established
focus on issues of concern to suppliers, specifically those
associated with the introduction of competition.
The content of this presentation is based largely on the
work of this group over the past 3 years.
Autumn 2005:
New structure for Eurogas groups is being introduced, and
the GSG work will be continued under a new group, the
Supply & Market Development Committee.
Eurogas Membership
Domestic (household) competition
Successful retail competition requires:
 Efficient, smooth customer switching
– Eurogas review of customer switching processes
 Availability of consumer information
– Eurogas consideration of provision of information,
including price comparisons
 Consumer protection
– Eurogas Position Paper on Direct Selling
1. Efficient, smooth customer switching
Eurogas review of customer switching processes
 Focus on the domestic (household) market
Identified:
 Key principles
 Main stages of switching process
 Approaches in different Member States
Key Switching Principles
 Maximising customer satisfaction/minimising confusion
 Effective mechanisms for controlling poor sales practices
 Minimising rejections, errors and process problems
 Fair and transparent procedures for process
changes/improvements
 Switching process to be non-discriminatory and procompetitive
The Switching Process
Main stages:
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Contract
Verification
[Objection]
Processing
Meter Reading
Despite these common elements, models vary from
country to country

variations due to structural differences in industry
organisation
Speed of transfer balanced by need for process controls
Switching Models
Seeking to impose standardisation where systems are
already (being) developed is not justified
But:
 helpful if customer experience at Member State level is
as far as possible similar for gas and electricity
 helpful if systems over time can converge
 helpful if modules can be identified to facilitate
convergence
Critical success factors for customer
switching
Successful customer switching not just on the
switching model, but also on:
 Robust service level agreements, in particular with DSO
 High quality industry data
 Properly managed industry dataflows
 Acceptable transfer meter readings
– differences between domestic and non-domestic markets
2. Availability of Consumer Information
Eurogas also recognises the importance of:
 Fair statements concerning price savings, and fair price
comparisons
– Standard methodology
 Simple clear billing
– Not critical to show network charges and gas prices
separately
 Independent and impartial websites
– Accreditation of sites
3. Consumer Protection
The interests of domestic consumer, particularly
vulnerable consumers, are best safeguarded by:

Competitive pricing

Protection against misselling

Clear communications, both as regards prices but also switching
process, transfer date etc.

Dispute settlement
Importance of dialogue with industry in the development
of appropriate safeguards
Eurogas Position Paper on Direct Selling
Position Paper on Direct Selling to Household Customers
emphasised importance of :
– Responsible selling, particularly where vulnerable
customers involved
– Clear information regarding services offered, prices,
contractual conditions
– Gas suppliers should act promptly when problems arise
Conclusions
 Customer interest closely aligned with that of suppliers
 Switching processes
– simple, efficient and as cheap as possible to operate
– speed of transfer balanced by proper process controls
– processes to be reviewed in light of experience
 Consumer information
– Ensure price comparisons not misleading
– Standard methodology
 Customer protection
– Sales and marketing
– Vulnerable customers
If full benefits of competition to be realised,
industry and regulator must work in partnership to
ensure these issues are addressed appropriately