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Archives for : January2015

Dull “negotiation” of gas contracts between suppliers and non-household customers on January 1st 2015

images8CFEHaaKKEAt customer level, the lack of knowledge specific to a competitive gas market, but also lack of interest of institutions for customers makes them be afraid to act. However, those who dared do it have faced major obstacles. We present below such an experience. In mid-November 2014, the customer receives a notice from the gas supplier, announcing the customer that as of January 1st 2015 the market of non-household customers would be liberalized and that it had two options:

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If you want cheap gas, let the market work

Fără titluThe “Fair Gas Prices” campaign, which I launched early this year, is likely to enter an area of populism, although our arguments of economic nature have no connection with it. Unfortunately, when you dare to say that gas prices could fall by a certain percentage (estimated of course), the media takes over only the percentage and not the argument. Energy-Center sells no illusions or “titles” with impact on readers. We seek solutions, we come up with arguments and accept opposing views. Which we also publish. In conclusion, beyond one interpretation or another, we will continue to argue that a free market must give the fair price. Moreover, we want, at all costs, this market to be competitive and regulated only at the level in which no agreements can be reached between parties to the detriment of other parties.

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In the absence of information, non-household customers become easy victims of natural gas suppliers

imagesGas market liberalization for non-household customers as of January 1st 2015 determined the gas suppliers to increase gas prices on average by around 1.42%, i.e. approximately RON 2.2 for each MWh consumed. The free market can set the fair price for gas only if the customer has the necessary knowledge, is well and properly informed and is not subject to pressure from suppliers. Following the analysis of price offers submitted by part of the gas suppliers to non-household customers, with which they had a gas supply contract in regulated regime until December 31st 2014, we can determine the behavior of these suppliers. It’s important to show that in November 2014 ANRE established the regulated prices for non-household customers to which these suppliers sold gas. Given that during December 2014 – January 2015 there were no essential changes in the structure of suppliers’ costs, gas price as of January 1st 2015 for non-household customers had to be lower or equal to the gas price for December 2014. This statement is confirmed by the practice of several suppliers, which offered smaller prices, respectively by suppliers which under the pressure of negotiations with customers informed and assisted by consultants have concluded contracts at prices below the price of December 2014. In the table below you can see that most suppliers offered an average price (B1, B2, B3, B4) higher than the regulated gas price at which these suppliers sold gas until December 31st 2014.

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Dominant position granted to suppliers in gas market liberalization for non-customers as of January 1st 2015

fără titlauThe way in which the switch from the regulated market to the free market takes place for non-household consumers is marked by a dominant position of suppliers (suppliers which sold gas at regulated prices to non-household customers until December 31st 2014) in relation to non-household customers. Under the Gas Law, the date of January 1st 2015 was established, two and a half years ago, as the date when the regulated market disappears for non-households, establishing the market in which gas can be traded freely.

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