Light and gas, everything changes from June. The rumors about the Government's willingness to give the final coup de grace to the "enhanced protection" market, i.e. the one involving 21 million electricity customers (out of 29) and 16 million gas customers (out of 20) started as early as December . And they have been strengthening as the discussion on the Competition bill, which the Mise (Ministry of Economic Development) is still completing and which is expected to be examined by the Council of Ministers on February 20th. Why this escalation? The circulated drafts of the provision are clear: "Starting from 30 June 2015" for electricity and "starting from 30 June 2016" for gas, the transitional regulation of energy prices for households and businesses with fewer than 50 employees is abolished. But the tug of war over the changes is not yet resolved.
CONTROLLED PURCHASES
What does it mean? In practice, a revolution. In fact, despite the full liberalization of the electricity market which took place in 2007 e of the gas market in 2003, in more than half of the European countries there are direct forms of final price regulation. In Italy it is the Energy Authority, the independent control body for the entire sector, which updates our bills every three months. In the case of electricity, it does so on the basis of wholesale quotations at which the Single Buyer procures half of its needs, in competition with other operators.
What the Single Buyer? It is a company 100% controlled by the Treasury which purchases large quantities of electricity for all domestic customers. A sort of maxi consumer purchasing consortium. With the new law on competition it would therefore be eliminated: in practice everyone would have to negotiate his bill independently with one of the operators present on the market. Neither more nor less than what happens today with cell phones or landlines. It is already possible to do this also for electricity or gas, but liberalization is struggling to progress: up until the end of 2014, only 1 electricity customer out of three had switched from the protected market to the free one. Basically 26% of families. In gas, the percentage drops to 20%.
PROS AND CONS
The proposal to move to full liberalization has aroused alarmed critics opposed to full support of the proponents of the free market. “Subtle doubt – writes a great expert like Alberto Clo, economist and former minister in his latest book "Electrical reforms between efficiency and equity" (Il Mulino) - is that the elimination of the protected market offers the temptation to supplier companies to improve their meager balance sheets, maneuvering the price lever upwards to increase margins that are currently negligible. What would happen – he concludes – if the approximately 28 million users were deprived of the possibility of obtaining supplies from the protected market at prices, according to the Authority, sometimes lower than those offered on the free market”.
Precisely for this reason the Authority has openly spoken out against the abolition of the protected market in June: "Our analyzes and research still make it clear that the level of awareness of consumers, small in particular, is not such as to be able to cancel overnight the protections that have been active since 2007 in this sector,” said the president Guido Bortoni. According to him, “the service will disappear, but only when the capabilities of the average consumer are such as to be able to recommend this choice. It's a matter of conditions."
On the other side is the Changing the which he has made liberalization and the reduction of energy prices one of his strong points. To support this line there is lBruno Leoni Institute, the liberal think tank listened to by Minister Federica Guidi: “Overcoming the current consumer protection regime in the gas market – said Lorenzo Castellani of the IBL – would help make the market more dynamic by leveraging the benefits of liberalisation”. So it would lead to lower prices. Push the manufacturers: Assoelectric and Assogas they have long been calling for market reform. But, as we said, the game between those in favor and against does not seem to be over yet.
USEFUL TOOLS
Nomisma Energy produces an in-depth study on liberalization every year. David Tabarelli, who is its president, seeks the balance point: “We know that there are serious companies on the market but also many clever ones, we are afraid of them and for this reason we want an Authority that protects us from risks, only to criticize its choices. Italy is a complex country. The free market offers opportunities to those who know how to use its mechanisms. On the Authority's website there is the Trova-offer, a search engine that compares all the updated offers on the market: some are lower than the protected market price; the majority are superior, but do not take into account the many collateral advantages in terms of additional services offered by the operators. Convenience must also be able to find it”.
