The role of Acquirente Unico in the Italian electricity market

Rome, 4 April 2013

Historical background

Directive 96/92/ECcommon rules of theinternal market inelectricity

• Lgs.Decree 79/99 established Acquirente Unico

SpA, with the mission of ensuring an adequate

availability of electricity generating capacity and

electricity supply to the captive market

Italian legislationEU directive

Directive 2003/54/ECopening up of theelectricity market, onthe demand side

3rd Energy Package,2009Boosting internalenergy market

• Law n. 125/2007 established "enhanced protection”

market, including households and SMEs which have

not chosen a supplier yet. AU in charge of:

• procuring electricity to cover the demand of the

“enhanced protection" market and supplying it to

retailers serving this market.

• Periodical monitoring surveys on competitive

conditions of retail market; independent out-of-

court resolution scheme for energy complaints

2

Regulatory framework

Italian electricity market model

AU

Enhanced ProtectionCustomers Customers

Enhanced Protection Suppliers

Safeguard suppliers

Safeguard Customers

IPEX, IDEX, MTE

Producers & Imports

Safeguard Market

Retailers

Wholesalers

Open MarketEnhanced Protection Market

3

In the period 2007-2012 the overall

share of “enhanced protection” has

been substantially reduced, going

from 124.3 TWh to 78.1 TWh

(approximately 24%) in terms of

energy demand on the national

network.

Self-production

Free market

Enhancedprotection

market

TWh

The compliance of the Italian model with the EU principles

Supply of electricity to the enhanced protection market

Percentage change

4

Energy procurement

Market evolution: switching trend for households and Small Medium Enterprises (millions of customers)

2007 2008 2009 2010 2011 2012

HOUSEHOLDS SMEs

5

Demand in 2012: 78,1 TWh

Energy procurement

Electricity covered by type of contract

Physical bilaterals(fixed price)

34%

Physical bilaterals(indexed price)

9%

Purchases in the MGP (uncovered 

requirements)54%

Purchases in the MGP (covered 

requirements)3%

Purchases in the MGP 57%

Physical bilaterals (fixed price) Physical bilaterals (indexed price)

Purchases in the MGP (uncovered requirements) Purchases in the MGP (covered requirements)

6

AU transfers electricity to distributors (or their entitled companies depending on the

number of customers served) at a price monthly based on its energy purchasing

costs, added with its own operating costs (cd. Prezzo di Cessione or Supply Price);

The final price of electricity applied by distributors to end users is set quarterly by

AEEG on the basis of the Supply Price added with regulated components.

• Supply Price 50%

• Marketing Costs (customers management) 4%

• Transmission, Distribution and Metering Tariffs 14,5%

• System general costs (incentives to FER, system research, etc.)* 18%

• Tax and VAT 13,5%

Thus “enhanced protection” consumers directly benefit from wholesale market

competition like large consumers.

Energy procurement

Reference price

7

CALL CENTER It supplies informative

services about energetic

markets’ liberalization and

consumers’ rights.

The Call Center has managed

since 2009 up to 1,700,000

inbound call with high-level

service quality

Energy consumers’ help desk

COMPLAINTS’ OFFICE

Increasing roles to support liberalization

Energy consumers’ help desk (Sportello per il Consumatore)Since 2009, the Energy consumers’ help desk, run by AU on the behalf of the EnergyAuthority, carries on a number of activities devoted to provide electricity and gasconsumers with information on their rights, on how to switch supplier and how to submit acomplaint..

Thanks to this office (more

than 80,000 complaints

received) consumers may rely

on a straightforward and

timely way to solve their

disputes with electricity

and/or gas retailers and

distribution operators.

8

IISSwitching process

Consumption volumes

New connectionsCompensatory

systemDatabase MGMT

Retailers

RetailersDistributors

Distributors

Italian legislation, in 2010, assigned toAcquirente Unico the design,development and operation of anIntegrated Information System (IIS).

Thus, the IIS will facilitate theexchange of data flows amongdistributors and sellers, also reducingbarriers to entry for new suppliers.

Furthermore, it will make the switchingprocess (and its perception byconsumers) faster, more certain andmore secure. An efficient processbuilds consumers’ confidence in thebenefits of competition.

Increasing roles to support liberalization – empowerment of customers

The Integrated Information System

Data flow

In implementing the Third Energy Package, the Italian Energy Regulator assigned the

organization and development of the ADR system to AU.

In case suppliers do not provide satisfactory solutions consumers should have the

possibility, before going to court, to get the problem with their supplier settled by

an independent out-of-court mechanism.

The objective is to enable the consumer to resolve a dispute and obtain

compensation for the harm suffered as a consequence of a commercial transaction

or practice. The ADR system, run by AU, has been operational from 1 April 2013,

with a 12-month test period, in order to guarantee an operational improvement.

New tasks

Alternative dispute resolution system

Recently Italian legislation established the Italian Central Stockholding Entity (OCSIT),

whose activities and functions have been attributed to Acquirente Unico. The main

purpose of the entity shall be to hold oil stocks within Italian territory. Furthermore it

will organise emergency and commercial stock and transport services.

OCSIT

Thank you for your attention!

www.acquirenteunico.it