The complexity of the transition procedure hinders – Shvedkyi about the gas market for the population

The abolition of PSO can launch the gas market for the population. But the complicated procedure for the transition of consumers from one seller to another can lead to the Ukrainians abandoning this market opportunity.

CEO ETG.UA Volodymyr Shvedkyi told about it in a comment for Kosatka.Media.

He explained: the decline in gas prices on the European market in 2019 was the reason for talks about the abolition of PSO for the population and the transition to a market model of cooperation between the consumer and the seller of gas. According to Volodymyr Shvedkyi, the last six months, private traders have had the economic opportunity to enter the retail gas market for domestic consumers – due to the fact that the market price for it has dropped to an eight-year low. But – people are scared by the complexity of the process of shifting household customers from a monopolist to independent companies. Shvedkyi believes that this is why consumers do not want to change the seller of gas.

“When a person analyzes, on the one hand, there is a waste of time for the transition (visits, consultations, collection of certificates), and on the other hand, saving only 0.5–2% on gas (after all, it is impossible to provide a large percentage of the discount). And, choosing between wasting time and these few percentages, the consumer is likely to choose to leave everything as it is. After all, he does not see the full picture of the fact that it will be profitable in the future. It is the factor of a difficult transition that does not allow the market to be launched. Ideally, independent suppliers should help the population in the transition from a monopolist”, said Volodymyr Shvedkyi.

A simple analogy: customers can open accounts in different banks and choose more favorable conditions for deposits and loans, as well as the convenience of settlements and payments. And each next bank does not require closing the account in the previous one. According to the expert, the same opportunities should be on the natural gas market. And the solution to the problem of gas supplies to domestic consumers can be precisely the optimization of procedures. Or the function of supporting the transition should be transferred to a new supplier.

There are different models in the European Union of how this is implemented. For example, a future supplier takes on the transition process and interacts with the previous supplier on the consumer transition. From the latter, only consent and a completed application are needed. And the supplier clarifies the debt issues, notifies the previous supplier and regulates the issues if they arise. In Ukraine, all this is on the shoulders of the consumer himself.

To apply for a change of supplier, a calculation must be made. This procedure takes up to a month. At the same time, gas continues to be consumed, and after a while a new reconciliation is needed. And all this only in order to receive an act with which a household consumer must come to a new supplier.

“In the gas market for industry, the procedure is similar. Specialists and power engineers deal with these issues that makes it much easier”, Shvedkyi said.

To solve this problem, a legislative or regulatory change in the procedure is necessary. Even an appropriate decision of the National Energy and Utilities Regulatory Commission will be enough, the expert believes.

Tags: gas, tariffs, legislation, NEURC, heating season, PSO, Gas market

Read also

Since the beginning of the year, gas transit decreased by 46% compared to last year.
OGTSU will be a declarant for foreign companies which store gas in Ukraine
The Cabinet of Ministers signed a memorandum on the possibility of gas supplies from the USA