Users are not benefiting from their performance

Spanish Competition authority requires the electricity companies to reduce the tariff for digital meters without distance reading

FACUA has reported the five major distributors and requires the refund of tens of millions of Euros overcharged. The companies apply a tariff for lending the new equipment that is only allowed by law when it is a part of a distance reading system.

Spanish Competition authority requires the electricity companies to reduce the tariff for digital meters without distance reading

Spanish National Commission on Financial Markets and Competition (CNMC, according to its initials in Spanish) has requested electricity distributors to reduce 33% the tariff they charge when lending the digital meters which are not connected to a distance reading system.

As FACUA-Consumers in Action has been repeatedly asking for, CNMC states that companies shall bill the users affected -most of those who are renting this kind of meter- the same as they are billing users who still have the old ones, since "they do not benefit from the performance of the new metering equipment".

This is what the Competition authority states in a report, requested by the Secretary of State of Energy, about the proposal of proceedings to check, validate, close and provision of the data out of meters connected to the distance reading system.

The report, dated last November, states on page 31 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".

FACUA submitted on November some complaints against the major five electricity distributors operating in Spain due to irregularities on their billing of the renting of the new meters. The association requests the appropriate authorities to impose the companies the refund of tens of millions of Euros overcharged to users 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 VAT) that, according to the regulation, could only be applied when the equipment gives a performance that 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 VAT).

Currently, Ministry of Industry estimates that there are 9.5 million new meters installed, which is 35% of total. Considering this amount, FACUA warns that electricity companies are illegally charging users no less than 37.24 million Euros per year.

Every user affected pays 3.92 Euros extra per year (0.3267 Euros per month) for renting smart meters which are not smart at all.

They don't meet the requirements of the 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 users with the old meters

This way, in homes where the new reading meters have been installed, users are being discriminated against 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 an unfair term when they charge a higher rent for the new equipment installed 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, according to its initials in Spanish), Spanish Consumers, Food Safety and Nutrition Agency (Aecosan, according to its initials in Spanish), 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.