MEDREG-REGULATORS
Event detail
06
DEC
Online meeting
6 December 2021
Providing tools to the Algerian regulator to improve the electricity and gas quality of service
On 6 December, the Algerian Commission for Electricity and Gas Regulation (CREG) explored concrete ways of monitoring the quality of service of the electricity and gas distribution activities, in a webinar involving the Italian, Portuguese, Spanish and Turkish energy regulators.

This technical exchange among regulatory peers, all members of MEDREG, was organised by MEDREG at the demand of the Algerian member, in a context of unbundling and liberalisation reforms of the Algerian electricity and gas distribution market.

Over the past decade, Algeria has been modernising the management of the electricity and gas distribution public service and has been working on a better protection for consumers, with higher standards of quality of service. With a review of performance indicators of the quality of service foreseen in 2023, CREG sees a chance to improve both the reporting and the auditing processes of the Algerian electricity and gas distribution activity.

This webinar aimed at responding to CREG’s desire to learn about practices of other regulators in terms of quality-of-service monitoring tools and methodology for the regulated electricity and gas distribution activity.

The Portuguese regulator (ERSE) shared its experience on the unbundling of its gas and electricity distribution systems, focusing on the concrete steps to ensure a quality management of their networks. Unbundling, or the separation of network from the activities of production, supply and storage is a pre-requisite for functioning competition and is therefore a key component of the liberalisation process. The neutrality of operators is one of the most relevant issues to have efficient retail markets in gas and electricity, and it is key to ensure that unbundling maintains and improves the quality of service in distribution.

This first session was followed by a presentation from the Italian regulator (ARERA) on its experience in developing its own system of performance indicators for the quality of service. Quality of supply regulation is indeed crucial to guarantee a good level of continuity of supply, voltage quality, gas quality and good services for energy consumers. Whenever distribution quality is not met, it is important to know who is responsible in any given situation and have ready a contingency plan to ensure that the problem is timely solved. Having a sound set of indicators is of great help to foresee possible problems and prevent them from developing.

For its part, the Spanish regulator (CNMC) presented the monitoring tools and methodology it applies to the electricity and gas distribution activities, in terms of their aims, features and approaches in retail market monitoring. Indeed, energy regulatory authorities are expected to exercise monitoring activities at national level and in cooperation with neighbouring countries (when possible) to ensure the establishment of competitive and well-functioning retail energy markets with aware consumers. These duties include monitoring the level of transparency of retail prices, the level and effectiveness of market opening and competition, and control that consumer rights are effective and enforced whenever needed.

Finally, the Turkish regulator shared the guidance and requirements it applies to distribution operators and companies on the data and information they must provide to the regulator. Indeed, regulators should ensure that the data provided to them by operators are sound and fully understandable. This guidance should include best practice for conducting and reporting information to ensure complete, accurate and timely data is submitted, including the format, content, scope, and timing of reporting.

Through the practical examples provided by the Portuguese, Italian, Spanish and Turkish regulatory peers, CREG colleagues were reassured that it is normal to experience some bumps at the beginning of the process. The main lesson learnt from the webinar is that it is preferable to concentrate on fewer but crucial indicators rather than on many. To this extent, the regulator shall guide Distribution System Operators (DSOs) on the monitoring process, with yearly checks and onsite audits, adapting its approach to the dimensions of the DSO. Even though the first years these audits might provide negative results, the fact that they are conducted yearly will produce a kind of discipline effect for DSOs, ensuring the quality of data provided. This will allow the regulator to collect well-recorded data and collect reliable and long-standing information.

Overall, this webinar, through the wide array of instructors and their expertise, provided CREG with the needed information to bring forward the regulation of the unbundled energy sector in Algeria.
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