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Spain's CNMC calls for equality across electricity meters

Source: FACUA - Sat 14th Feb 2015
Spain's CNMC calls for equality across electricity meters

The Spanish National Commission on Financial Markets and Competition (CNMC) has requested electricity distributors to reduce their tariffs by 33% when using digital meters which are not connected to a distance reading system.

The CNMC states that companies should bill users renting this kind of meter the same as those with the older model, since "they do not benefit from the performance of the new metering equipment".

The CNMC report, requested by the Secretary of State of Energy, covers the proposal of the procedure to check, validate, and report the data from meters connected to the distance reading system.

Page 31 of the report states that "for those consumers who have meters with telemetry capability and distance reading but when the trading company does not have been provisioned by the distribution company information on real time (not outlined), they should be billed the rent price of the old monophasic equipment (0.58 Euros per month, according to what is stated in Order ITC/3860/2007), since those consumers do not benefit from the performance of the new metering equipment".

Spanish Consumer Association FACUA submitted a number of complaints against the 5 major Spanish electricity distributors over irregularities on their billing of the rental charges applied to the new meters. The association requested the authorities to call for the refund of tens of millions of Euros overcharged to consumers when they were applied a tariff limited by the law only to the meters connected to a distance reading system.

The sector is charging users for the rent of the new meters a monthly fee of 0.9801 Euros (0.81 plus IVA) that, according to the regulation, could only be applied when the equipment gives a performance which it currently does not. The fee is 50% higher than the one set for the installations which do not give such performance, 0.6534 Euros (0.54 plus IVA).

Currently, Spain's Ministry of Industry estimates that there are 9.5 million new meters installed - 35% of total. Considering this amount, FACUA warns that electricity companies are illegally charging users no less than EU37.24 Mln per year.

Each consumer affected pays EU3.92 per year (0.3267 Euros per month) for renting smart meters which are not smart at all.

Not compliant with electricity legislation

Electricity legislation forces the sector to substitute every meter with contracted electric load of up to 15 kW with equipment that "shall be integrated into a remote management system and telemetry set up by the same body in charge of the corresponding reading" (article 9.8 of Royal Decree 1110/2007, of August 24).

FACUA warns that the millions of meters substituted up to this day do not meet the mandatory requirements of integration into the system that allow users to have time restrictions, remote reading and availability of information about their use. This data would allow users to take measures to have a more efficient expense and this would reduce their bills.

Nevertheless, electricity companies are billing users a tariff for renting the new meters that according to the legislation can only be applied if the requirements of integration in the remote management system and telemetry are met.

Discrimination against consumers with older technology

Homes with new meters are being discriminated against compared to those who still have the old ones, since they pay a much higher tariff without having the additional services.

FACUA states on its report that these practices breach the principle of non discrimination established on Directive 2009/72/EC, of July13, concerning common rules for the internal market in electricity. The European regulation has been transposed to Spanish legislation with Law 24/2013, of December 26, of electricity sector, where article 44.i imposes the users' right to "be supplied with prices which are easily and clearly comparable, transparent and non-discriminatory".

Unfair terms

FACUA believes that electricity companies apply unfair terms when charging higher rents for new equipment, despite not being integrated into the system by distributors.

The association reminds that the article 87.5 of Royal Legislative Decree approving the revised text of the General Law for the Protection of Consumers and Users states that is unfair any clause that "foresees charging for goods or services not used or consumed".

CNMC, Aecosan and regional consumers' authorities

The reports have been submitted to the Spanish National Commission on Financial Markets and Competition (CNMC), Spanish Consumers, Food Safety and Nutrition Agency (Aecosan), and consumers' protection authorities in the 17 autonomous communities.

The companies reported by FACUA are Iberdrola Distribución Eléctrica, Endesa Distribución, Unión Fenosa Distribución (Gas Natural Fenosa), Hidrocantábrico Distribución (EDP HC Energía) and E.On Distribución.

Recommended Reading :

* Spain sees average electricity bill increase 13.3% Jan - Dec

* EU to investigate Spain's illegal energy bills

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