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.
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The Italian Regulatory Authority for Energy, Networks and Environment ARERA carries out regulatory and supervisory activities in the sectors of electricity, natural gas, water services, waste cycle and district heating. Established by Law No. These functions are performed by balancing operators' economic and financial objectives with general social objectives, for environmental protection and the efficient use of resources. It also provides advisory services to the Government and the Parliament in matters within its competence, also for the purposes of defining, transposing and implementing EU legislation. The resources for the Authority's operation do not come from the State budget but from a contribution calculated on the revenues of regulated operators.
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.