OREANDA-NEWS. May 17, 2012. The Government of the Russian Federation made a decision to introduce changes to the Fundamental Provisions of Functioning of Retail Electric Power Markets. The new Retail Market Rules will protect the interests of bona fide consumers and suppliers, and enable developing competition and maintain reliability of electric power supply, reported the press-centre of FAS Russia.

In particular, the Rules provide for removing a number of restrictions for consumers changing an electric power supplier and entry to the wholesale market:

- Earlier changing a sales organization or entering to the wholesale market were related with difficulties to consumers, who had to obtain approvals from regional and federal regulatory bodies (conclusions on absence (presence) of adverse social and economic consequences). Currently this barrier is removed;

- Consumers will not be required to pay compensation (a sales mark-up for the provider of last resort) for changing an energy supplier if transition takes place at the beginning of the year after giving a 9-month notice;

- The new Rules of Retail Electric Power Market determine transparent procedures for installing and reading metering devices. In the new Rules the requirements for metering devices are limited, and network organizations are determined as responsible for installing metering devices;

- From October 2012, calculations of capacity in electric power industry will take place at the time of peak demand for a region. Earlier such calculations were completed at the time of peak demand for consumers; therefore, it was unbeneficial for them to optimize their energy consumption schedule;

- The new Rules considerably increase responsibility of consumers for registration-free and contract-free consumption.

“Electric power consumers were involved in discussing the draft Rules. Due to their active position, we were able to introduce several norms creating conditions for developing competition on retail electric power markets. Nevertheless, a considerable number of obstacles preventing entry to the wholesale market is preserved: first of all, it is the requirement to approve entry of a new participant to the wholesale market with a related incumbent participant of the wholesale market, which is either a direct competitor (the provider of last resort), exceptionally disinterested in reducing its clientele, or simply does not have efficient incentives as a responsibility for preventing market entry (a network organization, another participant of the wholesale market) – still, a positive effect of the changes is significant”, stated the Head of the Department of the Federal Antimonopoly Service (FAS Russia) for Control over Electric Power Industry, Vitaly Korolyov.

“Among positive aspects of the Fundamental Provisions of Functioning of Retail Electric Power Markets, there is removing a number of administrative and economic barriers for consumers who move from the provider of last resort to an energy supplier and enter the wholesale market. The Disputes Commission of the “Market Council” Non-Commercial Partnership has considered 60-70 complaints about preventing entry to the wholesale market, and in some incidents cases even reached FAS investigations. The issue of non-discriminatory access of all interested market participants to metering devices of electric power has been discussed. We believe that relevant changes must be formalized in the existing Rules for non-discriminatory access to the services of electric power transmission”, pointed out Deputy Head of FAS Russia, Anatoly Golomolzin.