Implementation of IME3 consultation and NI Domestic Market Opening - Six Month Review Findings Paper

The Utility Regulator publishes its EU Third Internal Energy Package (IME3) implementation paper and accompanying annex for consultation alongside a Six Month Review of the domestic market.

The EU paper outlines IME3 requirements and sets out how the Utility Regulator proposes to implement these requirements through proposed licence modifications.

This paper mainly deals with the consumer protection focused elements of IME3 and does not reflect the requirements for the unbundling of the ownership of electricity and gas transmission networks. IME3 allows Member States a further 18 months in which to implement the unbundling requirements. The Utility Regulator will seek to address this in a separate consultation exercise, once licensees have applied to be certified under a particular unbundling model.

A Six Month Review Findings Paper is also published.  This paper identifies areas within the emergent competitive domestic energy markets where the Utility Regulator has cause for concern. It also identifies specific areas where we consider licence modifications are appropriate to update both gas and electricity supply licences.  The need for an update reflects the reality that the licences were written at a time when there was no competition in the domestic sector.

We propose to formally consult on the modifications that emanate from, and are proposed in, the Six Month Review in the context of IME3 implementation and the reasons and effects regarding these modifications can therefore be found in chapter 2 “Retail and Consumer Issues” of the IME3 paper.  This is because of the direct relevance of this legislation to retail market development and customer protection.

The Six Month Review recommendations/proposed licence modifications are aimed at providing customer protection and so this review and the provisions of IME3 are linked by purpose and timing.

The Utility Regulator therefore proposes to consult on the energy supply licence modifications proposed in the 6 month review paper in the context of its consultation on IME3 - to avoid duplication and confusion.