Summary
Since the end of the year 2008 the metering market in Germany is fully liberalized. From that moment, not only the process of meter operation, i.e. installation, operation and maintenance of meters, but also the process of meter reading, i.e. data retrieval and data processing, is opened for the final consumers of electricity. Previously, both services have been conducted by the responsible network operator, who in addition, has been responsible for the billing process. For these three services he charged a common fee. Due to the liberalization of the metering market, the fees for meter operation and meter reading have to be earned on a competitive market, on which third service providers for meter operation or meter reading may be active additionally. In contrast, the billing fee is raised by the network operator only, who does not have to face any kind of competition due to the fact that he is a regulated monopolist. Liberalization puts pressure on the network operators to reduce their fees for meter operation and meter reading, in order to strengthen their position on the competitive market. Simultaneously, their incentives may rise to act strategically, as they might shift components from the metering fee to the billing fee. In consequence, the price for metering would go down, while the price for billing would go up, in order to compensate for a revenue reduction. Third metering operators or meter reading companies might be discriminated from that behavior, as they are not allowed to charge a billing fee.
This study addresses this topic empirically. It investigates, whether there exists evidence for strategic behavior of network operators. The analysis makes use of descriptive data analysis as well as of panel data econometrics. Data basis are yearly fees of meter operation, meter reading and billing for 796 network operators from 2007 to 2014. The focus is directed on final costumers with a standard load profile in the low voltage lines. The results indicate that some network operators operated strategically. They lowered the fees for metering services and simultaneously increased the billing fee in the same year. However, not all operators act in the same way. Small operators are more likely to act accordingly as well as operators from the eastern and southern parts of Germany. One can expect that this kind of behavior hampers the development of a free metering market in the long-run, such that political actors may think about possible interventions. However, the underlying costs of political actions should not exceed the expected benefits.
Discussion Paper is available for download.
