ISSUES OF LEGAL REGULATION OF COMPETITION AT ELECTRICITY MARKETS
( Pp. 60-63)

The article considers some features of the competitive relation formation in the electric power industry, a major economy sector. In particular, the paper analyzes the electricity retail market operation and the need for competition promotion. There, it is associated with a wide range of consumers, which adds high social significance to the effective operation of relations emerging in this area. The author concludes that the retail electricity market needs to increase private funds and decrease state participation, which will contribute to a wider range of service consumers. The article considers some special aspects on how to ensure the dominant position of power supply companies, as well as defines main barriers for business entities to enter retail electricity markets. It also reviews the best foreign practices that regulate energy retail companies (by the example of the Nordic countries) and offers some options of legal receptions in this area. Moreover, it analyzes the Russian legislation novelties in the field of competition at the electricity markets, in particular, the tariff regulation of electricity distributors by the method of reference costs. Also, the article specifies some proposals on how to improve the legislation that regulates competitive relations at the electric energy market within the National Competition Development Plan. Studies of problems in this field are devoted to the works of foreign authors, including: Franceszo C., Morgan I., and others. The study aims to research the competition legal regulation at retail electricity markets in order to draft recommendations on how to improve the legal regulation and identify existing problems. The formation of competitive relations at any product market that operates within the market relation is an important factor for sustainable business development which directly impacts the state’s economy efficiency in general and the quality of services provided. Russia’s transit to a market economy generated the «entrepreneurial management style» characterized by such an important factor as competition between business entities when producing goods, performing work or rendering services, in the electric power industry, inter alia [1]. However, some aspects of the electricity retail market have led to global violations of competition principles which resulted in overstated electricity tariffs. To take steps to solve this issues, the Government of the Russian Federation adopted the Resolution No. 863 «On Amendments to Certain Acts of the Government of the Russian Federation Regarding the Introduction of Guaranteeing Suppliers’ Sales Markups Using the Comparative Method and Declaration that subparagraph 2, paragraph 11 of the Resolution of the Government of the Russian Federation No. 1178 dated December 29, 2011 is no Longer in Force» on July 21, 2017. The Resolution was the first document in Russia’s legal space to introduce the concept of reference costs of the guaranteeing supplier which is understood as an economically reasonable specific value of costs associated with performance of regulated activities by the guaranteeing supplier, defined by the comparative method and established for expense items. In other words, this standard served as a measure to deter price competition at the market. The unified costs method is mainly used to encourage electricity retail companies to increase their efficiency. The research applied general scientific methods, such as analysis, modeling and comprehensive approach. Moreover, specific scientific methods were used, i.e. legal modeling and legal comparison.

Vengerovskiy E.L., (2018), ISSUES OF LEGAL REGULATION OF COMPETITION AT ELECTRICITY MARKETS. Economic Problems and Legal Practice, 6 => 60-63.

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