▷ Suppliers of last resort in the electricity sector

You’ve definitely heard the term suppliers of last resort for electricity and you’re probably wondering what that means. Together with the liberalization of the electricity market in Romania, the status of these suppliers and, at the same time, of course, their obligations were discussed. We know how difficult it can be to navigate the awkward expressions used by news agencies, so in this article we aim to explain the current situation in a way that everyone can understand.

What are these suppliers of last resort in the field of electricity?

To better understand the role of suppliers of last resort it is necessary to talk a little about market liberalization.

What is there to know about the liberalization of the electricity market?

The liberalization of the electricity market occurred gradually, over several years, partially liberalized, including the second half of 2020, and then completely from 1 January 2021. Market liberalization highlights the difference between the regulated energy market and the competitive market. The regulated market is the one you have been part of until now and from the beginning of this year you have the right to move to the competitive market, depending on what you want.

The main advantage of market liberalization is that you, as a customer, can negotiate directly with the electricity supplier and enjoy the best electricity price.

What does market liberalization mean for you?

The liberalization of the electricity market means that a new one must be chosen electricity supplieruntil June 31, 2021, according to a recent decision by the ANRE. You have the duty to inform yourself about the best offers on the market and conclude a new contract with the chosen supplier.

Until that date, the supplier of last resort has the obligation to provide you with the best offer it has and to cover the difference between this and the best offer on the market.

Ok, so who are the suppliers of last resort?

When we talk about suppliers of last resort in the electricity sector, we refer to those suppliers who have been appointed by the National Energy Regulatory Authority (ANRE) to supply electricity as a last resort for a limited period. Restart Energy is, for example, both a free market supplier and and provider of last resort.

In other words, the supplier of last resort is an emergency supplier, chosen by ANRE, who will provide you with electricity until you decide on a new supplier.

The supplier of last resort comes into its role when your current supplier, for various reasons, is no longer able to supply you with electricity, as required by the contract.

What are the duties of these electricity suppliers of last resort?

The supplier of last resort (FUI) has, in principle, the same duties and rights as the usual supplier, i.e. it must collect arrears and penalties, charge correctly for electricity consumed and so on.

At the same time, the supplier of last resort is obliged by law to make the process of changing suppliers simple and easy. Conformable ANRE, supplier of last resort, is obliged to send you the form with the free market offer, together with the monthly invoice, by 30 June 2021. Of course, you you can accept the offer or you can look for a better one. The liberalized electricity market allows precisely this: choosing the best offer, together with the best conditions. Pay attention to all the details and choose the best supplier for you.

Conclusion

Understanding the role of a supplier of last resort is essential for anyone navigating a liberalized electricity market. Although the concept may initially seem complex, its primary purpose is straightforward: to ensure that consumers continue receiving electricity even if their current supplier can no longer provide the service or if they have not yet selected a new provider. This mechanism guarantees continuity of supply and helps maintain stability within the energy market, protecting both residential and business customers from unexpected service interruptions.

The liberalization of electricity markets has created greater competition among energy suppliers, giving consumers more freedom to choose plans that best suit their needs. This increased competition often leads to better pricing options, improved customer service, and innovative energy solutions, including renewable electricity products. However, with greater consumer choice also comes the need to understand the regulations and protections that govern the market. Suppliers of last resort play an important role in ensuring that this competitive environment remains secure and reliable.

For consumers, understanding how these suppliers operate makes it easier to make informed decisions about energy contracts. Knowing the rights, obligations, and available options allows households and businesses to compare offers confidently while avoiding confusion during market transitions. It also helps consumers recognize that being transferred to a supplier of last resort is typically a temporary safeguard rather than a permanent arrangement, providing valuable time to evaluate alternative energy providers.

Businesses, in particular, benefit from understanding these mechanisms because uninterrupted electricity supply is critical for maintaining daily operations. Unexpected disruptions can lead to financial losses, reduced productivity, and operational challenges. The existence of suppliers of last resort minimizes these risks by ensuring that electricity remains available regardless of changes affecting individual energy providers.

As electricity markets continue to evolve, transparency and consumer education become increasingly important. Governments, regulators, and energy companies all share responsibility for providing clear information that enables consumers to understand their options and exercise their rights effectively. Well-informed customers are better equipped to select competitive energy plans that align with their financial goals and sustainability preferences.

Ultimately, suppliers of last resort represent an important safety net within modern electricity markets. Their role helps maintain confidence in the liberalized energy system by ensuring continuous service, protecting consumers during periods of market uncertainty, and supporting overall market stability. By understanding how these providers function, consumers can navigate the energy market with greater confidence, make more informed decisions, and take full advantage of the flexibility and opportunities that a competitive electricity sector has to offer.