CNIL Hands Notice to French Energy Company

17 May 2018

CNIL hands notice to french energy company

In March, the French data protection authority (‘CNIL’) announced it had issued a formal notice to DIRECT ENERGIE, Société Anonyme, for failing to obtain consent for the collection of customer usage data from its Linky smart meters. CNIL ordered that Direct Energie were to collect valid consent within three months of receiving the notice.

The CNIL decision, based on French law sets down the likely approach of other supervisory authorities within the EU.

The issue which CNIL have is that at the time customers had meters installed, they were asked to give only a SINGLE CONSENT for both 1) the installation of the meter 2) collection of hourly electricity consumption data. The purpose of this data was to enable determination of various tariff benefits.

Installation of the meters was mandatory, and so consent was not relevant. Therefore, the second limb of the requests, i.e. the consent to data collection, was invalid, because it not free itself as separate from the designation of the meter. Nor could it be considered informed and specific, as it was clustered together and dependant on the overall contract.

It is for organisations to ensure their systems reflect the new anti-profiling right of data protection by design, yet clearly Direct Energie failed in this regard. Further, it did not have a legal basis for processing the data, as the hourly consumption data was not necessary for the contract to be fulfilled, its customers are billed monthly.

Further, an organisation which seeks to rely on legitimate interest, is required to perform a legitimate interest assessment to enable it to balance those interests with the rights and freedoms of the individual. The collection of hourly data was, according to the CNIL, particularly intrusive and detrimental to the privacy of the individuals and in fact disregarded their rights and interests.

Direct Energie did not help themselves by publishing within its privacy notice that the hourly rate data would enable the customer to benefit from tariff deals, yet there were no tariff offers based on hourly consumption.

CNIL thereby concluded that the processing had no legal basis, since it was not based on valid consent, and that other possible legal bases failed.

Fortunately for Direct Energie, so long as it complies within the deadline set down by CNIL, it will not issue any penalty.

GDPR Article 21 sets down that an individual has the to object at any time to the profiling of personal data for direct marketing purposes. The similarities with this case, while subtle, make clear that prior consent is required due to the sensitive nature of energy consumption data collected, in all future cases where companies wish to have a better understanding of their customers’ behaviour by analysing their consumption habits which, ultimately, is linked to marketing strategies.  Organisations must therefore ensure they adapt their systems and adopt a way of working to ensure that any marketing or perceived 'customer benefits' which essentially form the basis of their own analysing data, is separate from the overall contract that their customer-base has entered into.

Facebook in particular, given the collection methods it uses, will have to change the way its marketing/analytical/statistical data is separated from its core function as a social media 'platform'.

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