translated from Spanish: Limits on the monopoly on electricity distribution

One of the most relevant changes that will cover the reform of the General Law on Electrical Services is the incorporation of the energy marketer, key to the liberation of the energy buying and selling market, which will allow users to choose their supplier competitively.
Thus, limiting the activities of distribution companies only to those with natural monopoly characteristics (such as distribution) was one of the principles of the Short Distribution Law (Law No. 21.194). The rationale is the transparency and generation of a competitive market, since these companies have significant advantages, in terms of direct contact possibilities and customer information, of which they have their data and behavioral statistics. The limitation will avoid possible scenarios of abuse of a dominant position, asymmetry of information and use of regulated structure to participate in a competitive market.
As if there were doubts, on 29 May, the CNE issued RE No. 176, which deepens the application of the exclusive turn, expressly stating that distributors should be constituted as exclusive transfer companies, indicating that the sale of energy and power to users who have opted for an over-the-counter (Free Customers) is particularly excluded , as well as the sale of other services and products.
In addition, on 7 July the CNE issued an update through the new RE No. 322, which amends OER No. 176, explicitly clarifying that the requirements contained will be deemed to be in force as of July 28, 2020. In other words, the legal impossibility of distribution companies to continue entering into supply contracts with free customers is clearly expressed, regardless of whether these are new contracts or renewals.
This clarification is very powerful as a message of the authority, since it reaffirms not only its commitment to the separation of activities, but also to the liberalization of the market, that is, that all customers can choose who to buy the energy from. This context makes us think of a promising and competitive future in the sector, where the emergence of various energy suppliers, electromobility products, energy efficiency, smart batteries, among others will be allowed.
 
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Original source in Spanish