Electricity Distribution System Operators Stuck With Millions…

Flemish energy regulator Vreg made news on Wednesday about the costs and revenue that electricity and natural gas distribution system operators are getting from their tariffs. Network operators must budget their costs and revenues annually. A year later, the invoice is issued. Is there a surplus or a shortage? In the event of a surplus, network operators give a discount on tariffs to customers, and in the event of a shortage, the tariff will rise.

This takes into account, among other things, the costs of purchasing all kinds of support certificates, network management, inflation and taxes.

As it turns out, the electricity grid’s distribution operators are running a deficit of 1% in their budget of 2.2 billion euros for 2020, or a shortfall of 22 million euros. The year before, they still had a surplus.

Will families and SMEs feel this way in the 2022 bill? “Don’t panic,” says de Frigg. After all, the shortfall is broken down into rates over two years. In addition, there were surpluses in 2019, which largely offset the 2020 deficit. De Vreg has already taken balances into account in the new tariff structure that will take effect in the middle of next year. “Distribution rates are determined by many factors, which are more decisive than scales,” emphasizes a spokeswoman for the regulator.

There is good news for balances with distribution managers in the natural gas network. There is a surplus of 4.5% in their budget of 500 million euros, compared to 22.5 million euros.