Supplier of last resort
European Union Electricity Market Glossary

 


 

 

Electricity suppliers of last resort exist in the European Union Internal Electeicity Market in all countries apart from France (ACER/CEER Annual Report on the Results of Monitoring the Internal Electricity and Gas Markets in 2015, Consumer Protection and Empowerment, November 2016, p. 7).

 

Recital 16 of the Proposal for a Directive of the European Parliament and of the Council on the internal market for electricity (recast) on common rules for the internal market in electricity (recast), 30.11.2016, COM(2016) 864 final 2016/0380 (COD)

 

It should be possible for Member States to appoint a supplier of last resort. That supplier may be the sales division of a vertically integrated undertaking, which also performs the functions of distribution, provided that it meets the unbundling requirements of this Directive.

 

 

There is no gas supplier of last resort in Bulgaria, Finland, France, Greece or Slovenia (no gas is available to final household consumers in Cyprus, Malta or Norway).

 

In most jurisdictions, supply of last resort is considered a precaution for supplier and/ or Distribution System Operator (DSO) failure, that is, in cases when a current supplier to the final household consumer goes bankrupt and is no longer able to perform its function, or the licenses of a current supplier or DSO are revoked.

 

However, suppliers of last resort often protect consumers with payment diffculties or inactive consumers beyond the business failures of energy service companies.

 

Protection in the case of payment diffculties refers to situations in which:


- final household consumer does not find a supplier in the free market (no energy supplier is willing to sign a contract with the consumer) or

 

- final household consumer is dropped by its current supplier because of non-payment.

 

Inactive consumers enjoy protection through a supply of last resort mechanism if:


- they do not choose a supplier when moving home,


- they do not choose a supplier when markets are deregulated, or


- their fixed term contract expires.

 

 

 

While actual figures are available for 20 (electricity) and 15 (gas) jurisdictions only, the numbers of electricity consumers supplied by suppliers of last resort range between 0 (in 9 jurisdictions: France, Great Britain, Hungary, Ireland, Lithuania, Luxembourg, Slovakia, Slovenia and the Netherlands) and more than 12 million (Spain). In Spain, this corresponds to 49% of household consumers, while in Romania 99.9% of household consumers (8.6 million) are supplied by the last resort supplier (similarly to Croatia, where more than 90% of all electricity consumers are supplied by the last resort supplier). In gas, a majority of NRAs have reported no consumers supplied by the supplier of last resort, e.g. Croatia, France, Great Britain, Hungary, Ireland, Lithuania, Luxembourg, Poland, Romania and the Netherlands. Among the remaining five jurisdictions for which information was reported, the number is highest in Spain (1.7 million), which corresponds to 23% of all gas household consumers.

 

ACER/CEER Annual Report on the Results of Monitoring the Internal Electricity and Gas Markets in 2015, Consumer Protection and Empowerment, November 2016, p. 8

 

 

 

Documentation

 

 

ACER/CEER Annual Report on the Results of Monitoring the Internal Electricity and Gas Markets in 2015, Consumer Protection and Empowerment, November 2016

 

 

 

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Last Updated on Monday, 12 December 2016 22:20
 

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