Oversight Tightens on Energy Market Practices in North America and Beyond

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National Markets and Competition Commission CNMC increased its oversight of how major energy providers market electricity and natural gas. On-site visits were conducted by investigators who posed as customers to explore the products and services offered by these firms.

Through mystery shopping, a technique that uses fictitious consumers to buy energy and services while also asking questions or filing complaints by phone and online channels, the competition authority last year involved more than 850 participants from both Turkey and international partners to assess the commercial practices within the energy sector. Additional procedures related to electricity and gas markets were carried out.

Fake customers tested firms by attempting to sign new products or tariffs, trying to terminate a contract, requesting details on how or by how much contract terms could be changed, or filing a claim. The firms analyzed spanned marketers of electricity and gas in both regulated and liberalized markets, including large groups such as Iberdrola, Endesa, Naturgy, Repsol, and TotalEnergies, along with smaller operators.

confusing information

CNMC’s investigation identified a pattern of nontransparent information provided to consumers during contract formation. The agency noted that pre-contract information was often incomplete during phone conversations, and in some instances contracts were concluded within the call, depriving customers of an opportunity to review offer terms. One marketer reportedly did not operate a telephone channel at all, while another imposed excessive wait times during calls for withdrawals and complaints.

The researchers also warned of confusing information given to consumers about the mechanism that caps the Iberian gas price, used to influence electricity costs. The final price for electricity included a compensatory component for many customers, a mechanism that regulation has not applied since February as gas costs did not exceed the cap.

Competition investigations also highlighted challenges or outright barriers to completing online contracts at regulated market rates. In recent months, both electricity and gas have sometimes been cheaper under regulated schemes than in the free market, helped by public subsidies or adjustments and government restrictions tied to the energy crisis. The CNMC report identifies problematic practices but does not attribute them to specific companies.

legal reforms

CNMC plans to share identified deficiencies directly with energy firms and monitor whether these groups adopt the recommended corrective measures. The agency is urging several regulatory changes from the executive branch to ensure that information provided by marketers to customers is accurate. This accuracy is described as essential for customers to understand the products they are contracting and to make informed choices.

In this framework, the competition authority proposes mandating that marketers in the regulated market offer a fully online channel to contract the regulated gas and electricity tariff, not just a partial option. It also proposes recording the entire commercial conversation, including pre-contract information that highlights key features of the offer, regardless of the source of the information. These steps aim to enhance transparency and consumer confidence in energy markets.

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