Energy companies cannot simply stop supplying energy to consumers because prices have risen. That is what the Netherlands Authority for Consumers & Markets (ACM) says in response to reports at its ACM ConsuWijzer counter.
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ACM cannot intervene in a company’s finances, but it can revoke the license if security of supply is at stake. All customers of the company are then ‘distributed’ to the other license holders.
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Watchdog ACM received several reports from consumers who received a letter from their energy supplier. It states that the company is canceling the supply agreement. Also, people would be told by their supplier that their fixed price contract will be terminated and they will be offered a variable price contract. The energy suppliers would point to the general terms and conditions or use it as an argument that there was non-payment.
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ACM suspects that a reason for the termination of the supply is the increase in energy prices. “We also get signals that this is mentioned in letters. We therefore point out to consumers the rights they have,” said a spokesperson for the authority.
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Termination of the energy supply without warning and without notice is never allowed, according to the ACM. Termination of the energy supply because a consumer has not paid is only allowed if the supplier has already sent a payment reminder in writing and the possibility of debt counseling has been pointed out.
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ACM cannot intervene in a company’s finances, but it can revoke the license if security of supply is at stake
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Fear
ACM advises consumers who are confronted with this to send their energy supplier a letter or e-mail, pointing out their rights. The authority will also address the companies concerned.
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The spokesperson cannot say which companies are involved, or how many reports have been received exactly. On Thursday, the ACM started an investigation into reports about energy company DGB Energie, which in letters to customers would give the sharply increased prices for gas and electricity as a reason for unilateral termination.
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According to ACM, consumers do not need to fear that they will no longer receive gas or electricity if their supplier does run into financial problems. ‘The ACM cannot intervene in a company’s finances, but it can revoke the license if the security of supply is at stake. All customers of the company are then ‘distributed’ to the other license holders. Consumers will then automatically receive a new energy contract from a new supplier and can decide after thirty days whether they want to remain a customer of this supplier’, according to ACM. ‘The bankruptcy of a supplier can have adverse financial consequences for consumers, for example if a consumer still has money to pay, or because he has to pay more from another supplier after the division.’
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Rates sharply up
The prices of gas and electricity have increased in recent weeks risen enormously. Rising gas prices saddle companies and households with significantly higher costs. It also drives up inflation.
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Energy suppliers will run into financial problems if they do not pass on the high purchase rates, mainly caused by the low gas stocks, to their customers. However, they cannot do this in all cases. A large proportion of consumers locked in the exceptionally low rate for two, three or even five years last year. One in three households will therefore not notice the price increases. The blows fall on the part of the customers whose contract has just ended.
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Chaos in the energy market
The chaos in the energy market has various causes. The purchase price for energy suppliers rose by 250 percent on the gas exchange. Stocks in the Netherlands dwindled last winter due to the severe frost and were subsequently not replenished due to all kinds of international developments. For example, Asia is claiming an increasing share of the supply and the European Union has ended up in a dispute with Russia about the commissioning of a new gas pipeline. A higher price for CO₂ is also pushing electricity prices to record highs.
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