DRIVING PERFORMANCE AT PORTUGAL'S ENERGY SERVICES REGULATORY AUTHORITY

As "market referees", regulators contribute to the delivery of essential public utilities. Their organisational culture, behaviour and governance are important factors in how regulators, and the sectors they oversee, perform. The OECD Performance Assessment Framework for Economic Regulators (PAFER) looks at the institutions, processes and practices that can create an organisational culture of performance and results. The report uses PAFER to assess elements linked to both the internal and external governance of Portugal's Energy Services Regulatory Authority (ERSE). The review acknowledges the well-respected status of ERSE within the institutional framework, analyses the key drivers of its performance, and identifies a number of challenges and opportunities to help the regulator prepare for the future, including in the context of deep market transformation and the COVID-19 crisis.

It finds that the ERSE is a mature and well-respected regulator, which has shown agility in taking on new roles over the past two and a half decades in support of the development of the Portuguese energy sector and outcomes for consumers. ERSE also demonstrated an advanced use of good regulatory practices through its three consultative councils, which act as a forum for creating consensus among key stakeholders.

This report is part of the OECD work programme on the governance of regulators and regulatory policy, led by the OECD Network of Economic Regulators and the OECD Regulatory Policy Committee, with the support of the Regulatory Policy Division of the OECD Directorate of Public Governance. The Directorate's mission is to help government at all levels design and implement strategic, evidence-based and innovative policies that support sustainable economic and social development. The report was presented to the OECD Network of Economic Regulators (NER) for comments and approval at its 15th meeting in November 2020.

The Energy Services Regulatory Authority (Entidade Reguladora dos Serviços Energéticos, ERSE) is Portugal's independent economic regulator for the energy sector. The regulator was established in 1997, concurrently with the liberalisation of the Portuguese electricity market. Throughout its existence, ERSE has provided stability and predictability to the sector. By virtue of technical expertise and capacity, it is currently highly regarded by stakeholders.

Foreword

Abbreviations and acronyms

Executive summary

Assessment and recommendations

1. Regulatory and sector context

2. Governance of the Energy Services Regulatory Authority

Annex A. Methodology