DiХi Group presents the Electricity Supplier Rating
On 11 November, DiXi Group presented the pilot issue of the Electricity Supplier Rating, which will be updated every six months.
By presenting this Rating to the broad public and market participants, DiXi Group sees its role in promoting the development of a competitive electricity market via independent monitoring of the process of reforming this market, identifying and objectively assessing market trends, promoting the formation of a transparent, nondiscriminatory policy based on data and fact analysis.
“The Electricity Supplier Rating is an instrument allowing to regularly evaluate companies based on a set of indicators, compile their overall rating and ratings based on particular categories, make analytical generalisations and monitor the process. It will help consumers find out who is who in the market,” DiХi Group expert Bohdan Serebrennikov explained during the online presentation.
The Electricity Supplier Rating is an analytical product geared mainly toward two target audiences: suppliers and consumers. It will help suppliers improve their services, commercial offers, transparency and other aspects of their activity, thus intensifying market competition, and consumers will be able to make a more informed selection of a supplier based on a number of criteria in addition to the price.
The rating covers the 50 largest players in the electricity market (80% of the retail market). The total average score of companies included to the analysed sample is only 0.345 with a maximum score of 1.
“It means, in particular, that many suppliers have a huge room for improvement of their commercial performance and increasing their competitive advantages,” Bohdan Serebrennikov stressed.
Only three suppliers were able to make it to the ranks of the Rating’s leaders with the total score within the 0.7 to 1 range. 28 suppliers went into the “average” category, whose total score ranged between 0.3 and 0.7. And the “hidden reserves” group contains 19 suppliers with a total score below 0.3.
“The average scores of suppliers based on different indicators differ significantly. There is a group of indicators quite close to zero, which means that there are a huge reserve and potential for performance and improvement for players in the electricity market. The biggest gap between universal service providers and suppliers at free prices is observed in the online service category,” the expert said.
The companies received the highest average score in “Information for consumers” category (0.603) and the lowest in “Transparency and business activity” (0.184). The latter category has no leaders at all, and the low number of points scored by the companies can be explained by the fact that most of them do not publish their financial statements, and only one out of the 50 suppliers included to the sample published its nonfinancial reports.
According to an analysis, the companies may achieve substantial progress in the Rating if they become ready to increase their transparency, implement modern formats of online service and create a wide range of commercial offers catering to the needs of consumers. The publication of the Electricity Supplier Rating will motivate companies to enhance their competitive edge by improving the quality of their services and commercial offers for consumers, their customer orientation and transparency for the purposes of scaling their business and entering the national level.
Experts will continue monitoring how services and other aspects of the companies’ operation change in the process of competition, and whether it reduces the difference in indicators among them.
During the presentation, DiXi Group President Olena Pavlenko spoke about the think tank’s plans.
“Ukraine’s energy markets are in the process of opening. It enables competition among companies. To be sure, the speed and degree of market opening are different for the moment. In the gas market, all consumers are able to choose a supplier, while in the electricity market it can be done by all except individual consumers, but in the future, it will apply to households as well,” Olena Pavlenko said. “At this moment, our rating was compiled for the electricity market only. We are very keen to make the same rating for the gas market as well because it already sees competition for households. To do that, we need data from the NEURC, which we hope to receive.”
Source: DiXi Group