Context
On 16 August 2011, the Flemish Decree of 8 July 2011 modifying the Law of 10 March 1925 on the distribution of electricity and the Energy Decree of 8 May 2009, was published in the Belgian Official Journal.
This Decree transposes EC Directives 2009/72/EC and 2009/72/EC into Flemish legislation.
The Decree is expected to have a significant impact on the participants in the field.
New concepts
The Decree defines key concepts included in the Third Energy Package, such as smart meters, closed and private distribution grids.
Regulatory competences
As required, the Decree strengthens the competences of the Flemish Regulator of the Electricity and Gas Market (the VREG). The detailed description of these competences reflects the potentially far-reaching intervention power of the VREG.
Indeed, the VREG will now explicitly supervise, amongst others:
- The quality of the services provided by the suppliers, including their systems facilitating advance payment and their processes to cope with complaints of consumers;
- The free access of the consumer to his or her consumption data;
- The effectiveness of the liberalisation of the electricity and gas market,including the monitoring of the percentages relating to the supplier switchingand termination of contracts.
Furthermore, the VREG is now explicitly empowered to impose measures guaranteeing effective competition, for example by facilitating the access to the grid to the benefit of new production capacity.
Free Circulation of Supply Services
It should be noted that as of now, in accordance with the European requirements of free circulation of services, entities licensed to supply in any other country of the European Union or the European Economic Area, do not need to obtain a Flemish supply license from VREG.
Complaint Mechanism and Mediation Services
Parties with complaints against a transmission system operator or a closed distribution grid operator regarding its obligations, have the possibility to submit the dispute, in writing, before the VREG in accordance with a standard procedure, in view of reaching a settlement.
The VREG must settle the dispute by means of a thoroughly motivated and binding decision within two months upon receipt of the complaint. Only disputes which have already been subject to reconciliation efforts by the VREG or the Mediation Service for Energy may be submitted for settlement to the VREG.
Closed and private distribution grids
In line with the Cityworks Judgment of the European Court of Justice and article 28 of Directive 2009/72/EC, the Decree provides for an extensive new legal regime with regard to the construction and / or the operations of closed distribution grids and private distribution grids. In this regard, special attention is given to "customers and grid users "lying behind" another network user .
Smart meters
The concept of smart meters is introduced into the Flemish legal order and is defined as followed: "an electronic meter, which measures and registers energy currents and related physical variables and which is equipped with a two-way communication means, ensuring that data can be read locally, as well as remotely and, furthermore, ensuring that the meter is capable of executing certain actions based on the data it
receives locally or remotely".
The Decree provides for the submission by the Flemish Government of an evaluation of the costs and benefits of the introduction of smart meters for electricity and gas to the market and the consumers by 3 September 2012 the latest.
Switching
Finally, and important in practice, the Decree explicitly states that if a consumer wishes to change supplier, the grid operator must arrange for this within three weeks upon receipt of the notification of the consumer, hereby taking into account the governing contractual provisions.
