In a report published on Wednesday 4 November 2015, the Institut Luxembourgeois de Regulation (ILR) concluded that prices put forward to residential consumers by electricity and natural gas suppliers are reasonable, whilst the determination of these prices still lacks a certain degree of transparency.
The report, published on www.STROUMaGAS.lu, examined company compliance with regards to obligations related to the supply of electricity and natural gas, public service obligations as well as, in the case of electricity, quality of universal service.
A European comparative analysis found that the price of integrated electricity and natual gas offered to residential customers in Luxembourg are reasonable. However, regarding electricity, the non-responsiveness of supply prices to the price development of the stock market suggested a lack of competitive pressure housing market of electricity which can lead to an increase in supplier margins.
With the help of calculix.lu, supply prices are comparable, transparent and published through a comparison of electricity and natural gas prices performed by the site. These prices were also found to be non-discrimatory, with electricity and natural gas deals available to residential customers under equal conditions in the same network.
However, the ILR stated that it is of the best interest of consumers for providers to offer the public more detailed information, including the decomposition of prices of integrated provision in its different components, such as network costs, energy and supply prices, taxes and possible discounts. The Institute recommended that this information become more readily accessible, for example on the websites of providers and at point of sale.
Suppliers were also advised to ensure adequate disclosure of their terms and rates of default provision and last recourse supply. They were called to reconsider pricing respective to the legal framework, particularly regarding natural gas.
The Institute further claimed that a significant increase in the transparence of changing supply prices could be achieved if the suppliers were to offer price formulas based on publicly available indicators.
The ILR stated that the best way to ensure reasonable prices on the market was to introduce competition between suppiers, with consumers invited to become more active and to take it upon themselves to learn of the offers available in order to avoid the risk of money loss.
To this end, the Institute has implemented an electricity and natural gas price comparison website, www.calculix.lu, which assembles all offers available to residential customers. Supplier switching is therefore easy, free of charge and requires a mere few steps for the customer.
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