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DTe: Adjustment to Supplier Model Necessary

The design the so-called supplier model and its application to the market for small consumers must be changed. The Office of Energy Regulation (DTe) bases its standpoint on the results of research carried out by KPMG. It appears from this research that the present implementation and application of the supplier model contains risks for competition between supply companies on the market for small consumers.

In accordance with the supplier model, customers receive a bill from their supplier which includes not only the supply costs, but also the grid manager's costs. DTe attaches considerable value to the application of the supplier model in the market for small consumers because this model makes it possible for customers to switch suppliers without receiving two separate bills.

With regard to the application of the supplier model, agreement was reached between the supply companies and the grid managers in the so-called Model Agreements in Relation to the Supplier Model [Modelovereenkomsten Leveranciersmodel]. Examples of agreements reached include the necessary guarantees and administrative charges for the collection by the supplier of the grid manager's charges. It appears from KPMG's research, commissioned by DTe, that these agreements and the way in which they are implemented in practice may result in unfair competition between existing suppliers (comprising the concerns with a grid) and new suppliers (which are not part of a concern with a grid).

Promoting a level playing field on the electricity market is at the heart of DTe's mission. Since KPMG's report clarifies that there is indeed a risk of unfair competition, DTe considers it necessary to amend the model agreements. With a view to this, DTe has requested EnergieNed, the branch organisation of energy companies, to present concrete proposals, at the latest in December 2004, on the way in which the most important recommendations made by KPMG can be elaborated and implemented.

KPMG's report and DTe's standpoint in relation to this report can be obtained as of today from DTe's website under the heading of 'Publications'.