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Ranking the Competitiveness of Retail Electricity and Gas Markets: A proposed methodology
The Agency for the Cooperation of Energy Regulators (ACER) commissioned IPA Advisory (IPA) in May 2015 to conduct a Study regarding “Ranking the competitiveness of the retail electricity and gas markets at the national level in Member States of the Union and in Norway”.
The scope of work comprised:
a review of relevant literature;
the identification and assessment of indicators that ACER can use to evaluate retail market competition in electricity and gas;
the development of a methodology for using these indicators to rank the competition performance of retail electricity and gas markets in Member States (MS) of the European Union (EU) and Norway; and
undertaking a Pilot Study of this method for a small number of countries.
The emphasis, as requested by ACER, has been on how to rank the countries through establishing a composite indicator (CI) of competition. In practice, we have also looked at data for all countries, as we believe it necessary to assess the indicators and understand how they can be combined into a CI. As part of this we have developed a CI tool, which calculates CIs for retail electricity and gas markets. For the purposes of this project, we have focused on the household sector as data are more readily available than for the retail sector as a whole. However, the proposed method is applicable to either.
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