The new tariff method for the first regulatory period is asymmetric and flexible, allowing Local Authorities to choose one out of four possible regulatory schemes, depending on the combination between objectives done by the operators and the level of investment planned by the competent Local Authority. AEEGSI regulation applies to the following water and wastewater services whether integrated or taken individually : abstraction services, conveyance and distribution of water for civil usage, sewerage and wastewater treatment or each of the individual services mentioned above, including services for extraction and multi-purpose conveyance and water treatment services for mixed residential and industrial usage. The new Tariff Methodology in place since 27 December Res. It applies for the 1st regulatory period The tariff method consists in setting a revenues limit with respect to the sum of 5 cost components defined by AEEGSI:. AEEGSI identifies minimum levels of technical and commercial quality of water services, and monitors their compliance. Environmental quality i. Before , quality of service was defined in specific agreements between the Local Authority and the Operator, based on the model provided by the Government.
Indeed, consumers, be they businesses or private parties, are now free to choose their own suppliers. This happened for residential customers in the gas market as of 1 January and in the electricity market as of 1 July In Italy, in parallel with the free market, residential customers are still able to choose consumer protection services with pricing and supply conditions established by the Authority for Electricity, Gas and Water AEEGSI. The Authority AEEGSI is currently evaluating the timing for the completion of the market deregulation process, which will entail the complete elimination of protected rates. According to the proposals currently under discussion, the protected market will most likely be fully phased out in It is an independent, autonomous and collegial body designed to harmoniously govern the sector deregulation process while favouring conditions of effective competition amongst the various operators present in the market, supervising the rates system, verifying the quality, efficiency and environmental sustainability of the services provided and, especially, consolidating the role and power of consumers by defining, promoting and protecting their rights. Based on this model, the distribution and sale of gas and electricity are distinct activities, and sales companies and distribution companies operate in the energy market separately with different objectives and responsibilities. Hera is the Italian multi-utility that improves every day, with regard to the environment, the quality of its waste management, water and energy services through strong links in the area in which it operates and the capacity for innovation.
Regulation of the Italian water sector has undergone profound change over the past decade. Until , it was based on local contracts and lacked a nationwide tariff framework, and the sector outlook appeared disordered and complex—as discussed in a Agenda article. Since overall performance has improved. See Bardelli, L. In December , law n.