The Environment Minister Asks ERSE to Draft Itself the Power to Fine the Fuel Sector, and to Settle Which Official Price Drivers Should Believe

Portugal's energy regulator can fine an electricity supplier that misleads a customer. It cannot do the same to a fuel retailer. The Minister of Environment and Energy has now told ERSE to work out how to change that.

In a letter dated 28 August to the chair of ERSE's board, seen by Lusa, Maria da Graça Carvalho says she agrees with the recommendations the regulator put to her in the study on road-fuel price formation it published on 14 August, and instructs it to deepen two of them. The second is the one with teeth: she asks ERSE to work through "the extension of ERSE's sanctioning powers to the National Petroleum System", covering the obligations that already fall inside its economic regulation and supervision remit, so as to protect "all consumers".

Two price references that do not agree

The first task is about numbers drivers already see and cannot reconcile. Portugal publishes more than one official fuel-price reference. ERSE puts out a Preço Eficiente. ENSE, the national energy sector body, publishes a Preço de Referência. The Directorate-General for Energy and Geology has its own methodology for presenting prices after discounts. The minister wants the public references harmonised, the DGEG methodology reviewed, and the coexistence of the two reference prices resolved, so that consumers get information that is "clearer, more coherent and more accessible".

She has also asked the regulator for a note setting out the concrete next steps, a timetable for them, and whether any legislative or regulatory changes are needed, with the material required to prepare them. In other words, ERSE is being asked to draft its own new powers.

What the August study said

The study, commissioned in July, was in one respect a relief for the industry: it found no case for the state to intervene administratively in prices, and concluded that Portuguese pump prices do not rise faster than they fall, rejecting a cap on margins. Galp had publicly rejected capped margins when the study was ordered.

What it did recommend was structural. Beyond harmonising the price references, ERSE asked the government to set annual biofuel blending targets clearly and in good time, so that differing incorporation levels do not create cost advantages "that do not result from greater efficiency". It proposed periodic review with the DGEG of how discounted prices are calculated, including which discounts count and how they are weighted. And it floated temporary, targeted support for specific segments, professional road haulage among them, if exceptional disruption persists.

What this means for expats

• Nothing changes at the pump this week: the letter starts a process. Extending sanctioning powers to the petroleum system will need a legislative change, and ERSE has been asked to say what that change should be.
• Read the reference price you are given with care: until the references are harmonised, the "efficient price" and the "reference price" are produced by different bodies on different bases, and neither is what you pay.
• The discount arithmetic is about to be reopened: the DGEG's method for presenting prices with discounts applied is under review, which matters if you compare stations on the published figures.
• Fuel taxation is moving separately: the government reclaimed part of its fuel-tax discount at the end of August, and the rebate has been adjusted repeatedly through the summer.
• Refiner profits are a live political issue: Portugal revived a windfall levy on oil refiners in July.