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Financial accounts of regional network operators must be clearer

The Netherlands Authority for Consumers and Markets (ACM) has inspected the financial accounts of the regional network operators. It turns out that the costs that the network operators had claimed have not always been correct. Correcting these errors lead to both positive and negative corrections. As a result of these inspections, approximately EUR 20 million will be deducted from the cost calculation. This amount will be taken into consideration in the calculations of the new network tariff for 2015 that the network operators will charge consumers and businesses.

Regulatory costs only

With regard to their tariffs, regional network operators of electricity and natural gas are only allowed to claim costs that are associated with their duties concerning the transmission of electricity and natural gas, and connecting customers to the energy networks. This means that network operators are not allowed to claim with ACM any costs that they incur for commercial activities that they offer in competition with other market participants.

Transparency in financial accounts

The identified errors are mostly caused by the complexity of the financial accounts of network operators, as a result of which costs are not always allocated correctly. If network operators are part of a group, transparency in cost accounting is even lower. Henk Don, Member of the Board of ACM, explains: “There is still a lot to be gained when it comes to transparency in the financial accounts of network operators. Network operators must devote constant attention to internal audits and to a structured accounting method. Having clear financial accounts makes it easier to carry out such audits. This prevents network operators from claiming costs that they are not allowed to claim. Such costs are wrongly included in the tariff that consumers and businesses pay for energy transmission.” ACM will sit down with network operators to discuss this matter.