debt-flagging data system

RAAEY working on new version of ‘energy tourism’ restrictions

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Residential electricity consumers will be permitted to change as many as three suppliers without having previously settled older energy bills or made installment-based payback arrangements, while business consumers will be set a two-supplier limit, according to a latest third version of upcoming rules intended to prevent consumers from abandoning suppliers despite owing electricity-bill amounts, a phenomenon locally dubbed “energy tourism”.

These limits for residential and business consumers will be applied retroactively, beginning January 1, 2020.

The new rules will also include a debt-flagging system on a collective platform maintained by distribution network operator DEDDIE/HEDNO, so that suppliers may be aware if prospective customers have been on the run.

Also, punctual customers will, as a reward, face less red tape if wanting to switch electricity suppliers.

RAAEY, the Regulatory Authority for Waste, Energy and Water, is now working on the latest revisions to the plan, which, once completed, will be forwarded to the energy ministry for implementation.

 

RAAEY plan tackling consumer switching set for consultation

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A proposal prepared by RAAEY, the Regulatory Authority for Waste, Energy and Water, for revisions to Article 42 of the retail electricity market’s supply code as a means of countering supplier switches by debt-escaping consumers, while, at the same time, providing greater switching flexibility to punctual customers, is expected to be forwarded for consultation this week.

The adoption of a debt-flagging system as a collective data base identifying non-punctual customers for all suppliers to see is a key aspect of the new strategy. Unpaid receivables owed by roving consumers exploiting lax rules have risen to alarming levels.

The debt-flagging system will be color-based. Consumers with unsettled bills will appear highlighted in red in the system’s collective data base after have received a final warning on such action from their supplier, who, following this step, will be entitled to request supply cuts from the grid operator if overdue amounts remain unsettled or an installment-based payment schedules has not been established.

According to the RAAEY proposal, suppliers will maintain the right to redden former customers on the run for up to three months after they have fled to rival suppliers, but electricity-cut rights of suppliers against former customers will expire 12 months following their departures.

Electricity market measures to be announced next Wednesday

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Energy minister Thodoris Skylakakis plans to announce, on November 1, details of imminent energy-cost measures intended to subdue retail electricity prices by intensifying competition through a single variable-tariff formula for all suppliers, who will remain free to set profit margins in accordance with their pricing policies, while also offering selective subsidy support to low-income households.

The single variable-tariff formula for all suppliers is also intended to offer consumers greater clarity by improving their price-comparing ability.

The ministry, expected to submit to parliament an amendment for the single variable-tariff formula any day now, believes its package of new measures, planned to be implemented January 1 in place of energy-crisis measures that included universal electricity subsidies and a freeze on indexation clauses, will help contain energy costs, despite the reactivation of indexation clauses and the widening Middle East conflict.

According to the plan, all electricity consumers will be automatically transferred to the new single variable tariff as of January 1, for 12 months, unless they opt, prior to this date, for any other supply deals offered by suppliers.

Electricity suppliers, convinced the single variable-tariff formula will not enable them to mitigate risk and also breach EU market rules, are already calling for changes to the plan.

In response, the ministry has noted suppliers will be free to set profit margin levels as they please. It has also pointed to a recent EU report highlighting the need for greater transparency in the Greek energy market.

Next Wednesday’s announcements by the energy minister will also include details on a new debt-flagging system designed to contain the high level of unpaid receivables in the country’s electricity market. The minister’s package of measures is also expected to contain an action plan addressing electricity theft.

‘Red status’ after two unpaid bills for debt-flagging system

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A debt-flagging system being prepared by the energy ministry for the retail electricity market as a means of countering roving consumers who switch suppliers and escape from unsettled electricity bills would relegate consumers with two successive unpaid bills into a red zone, entitling suppliers to take action by requesting power supply cuts from the operator, the ministry appears to have decided.

Energy minister Thodoris Skylakakis held a meeting yesterday with officials from RAAEY, the Regulatory Authority for Waste, Energy and Water, and distribution network operator DEDDIE/HEDNO to discuss details of the debt-flagging system.

Consumers in the red-zone category would only be allowed to switch suppliers if their existing supplier refrains from disrupting their power supply.

Also, consumers would be removed from the red-zone category if they settle overdue amounts or begin servicing them through installment-based payback plans, according to the ministry’s plan.

The ministry is striving to finalize the plan’s shape as soon as possible as it aims to present it within October.

Over 30,000 consumers are believed to owe electricity-bill amounts to more than one supplier, according to ministry estimates.

Unpaid receivables, market officials estimate, have ballooned to approximately one billion euros. The sum has risen sharply since July, 2022, when consumers were given the freedom to switch suppliers even if owing amounts to previous suppliers.

Debt-flagging system needs more work, ministry decides

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A debt-flagging system being prepared by the energy ministry for the retail electricity market as a means of countering roving consumers who switch suppliers and escape from unsettled electricity bills requires further development, the ministry has decided.

Details still needed to finalize the plan, part of wider revisions to the supply code, will be discussed at an energy ministry meeting on Thursday to involve representatives of RAAEY, the Regulatory Authority for Waste, Energy and Water, and distribution network operator DEDDIE/HEDNO, to manage the debt-flagging system.

DEDDIE/HEDNO has requested a limit to its responsibility for the system as the operator will have no way of cross-examining the validity of data posted by suppliers. This is one of the draft’s needed improvements that will be discussed at Thursday’s meeting.

The aim is to establish clear-cut rules on customer switching in order to protect suppliers, hit by a sharp rise in bad debt. Customer credibility will be signified through a color-based ranking system.

An additional meeting could be required next week. The energy ministry wants all revisions finalized within the next couple of weeks so that it can present an upgraded supply code before the end of October.

Debt-flagging system for electricity market ‘imminent’

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A debt-flagging system to be made available to electricity suppliers as part of an effort to counter serial electricity-bill defaulters could be ready imminently, within the next month or two, officials at distribution network operator DEDDIE/HEDNO and RAAEY, the Regulatory Authority for Waste, Energy and Water, agreed during a meeting on Wednesday that included electricity supplier representatives as observers.

RAAEY presented a comprehensive plan for the development of a debt-flagging system, which DEDDIE/HEDNO officials ascertained could be ready for launch one to two months from now, sources informed.

However, DEDDIE/HEDNO clarified that it cannot take any responsibility for data to be posted on the debt-flagging system as it has no way of verifying its validity, the sources added.

As this data will be provided by electricity suppliers, establishing a transparent formula is crucial to ensure the operator will not be held accountable in the event that a consumer is erroneously marked as delinquent in the system due to a supplier’s mistake, and, as a result, suffers unjust repercussions without actually having outstanding debts.

Electricity suppliers are facing a surge in bad debts resulting from customers who opt to switch companies and leave behind unpaid bills, while just one in ten non-punctual consumers who have been blacklisted by suppliers and subsequently resorted to the country’s universal electricity supply service – offered, by law, by the top five suppliers – are paying fees for this service.

Ministry preparing debt-flagging data system for 2024

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Recently appointed energy minister Theodoros Skylakakis expects to have a detailed draft for a debt-flagging data system covering the energy market by September, the official has reiterated in comments to local media over the past fortnight.

The prospective debt-flagging data system, a topic discussed for years by market officials as a solution to the accumulation of unpaid receivables burdening energy suppliers, would detail energy-bill payment records of consumers for all market players to see.

Once introduced, the debt-flagging data system, to be fashioned in the style of an equivalent system used by the banking sector, would enable energy suppliers to check consumer payment records before they sign up new customers.

Following years of hesitation, rival electricity suppliers now appear far more willing to cooperate on the implementation of a debt-flagging data system as all have been victims of runaway consumers exploiting loopholes to switch suppliers despite owing previous energy-bill amounts.

The local retail energy market’s unpaid receivables, including amounts that have gone down as bad debt, have ballooned to exceed one billion euros.

It remains unclear if the energy market’s debt-flagging data system will be launched this year or next, but the latter appears most probable as work is still required to finalize the plan.

One thing for certain, the energy market’s rules will change. Current rules do not restrict consumers from switching suppliers, even if they are behind on energy bill payments to existing suppliers.

The problem worsened for suppliers approximately a year ago, when the government, as part of a package of energy crisis measures, included a rule amendment permitting consumers to switch suppliers without incurring penalties for premature withdrawals from contracts.