- Multiple supply contracts are legally supported in the EU: Directive 2024/1711 allows customers to hold more than one electricity supply contract simultaneously, opening the door to flexible consumption and innovative energy services. However, the implementation of this provision can be challenging for DSO and suppliers. In this paper, we focus on the challenges for suppliers:
- Change in consumers’ profile: engaging in multiple suppliers’ contracts, when technically feasible, alter the customer’s load profile modifying the contract’s economic balance and existing supply contract by making forecasts inaccurate and deeply change the volume repartition within price periods. This misalignment risks causing procurement inefficiencies, financial exposure, and system imbalances. To prevent backlash, suppliers have to be notified of any new contracts that may affect consumption profile so that suppliers can adapt their contracts and forecasts.
- Generated additional cost: implementing the right to engage multiple suppliers will involve significant costs, including updating IT systems and metering infrastructure. While these investments are necessary, it is essential to ensure they do not disproportionately increase overall costs for the electricity system or end consumers.
- Having the right meters in place: for multiple supply contracts, meters must accurately allocate consumption between suppliers to ensure proper settlement and transparency. They must operate non-discriminatorily, treating all suppliers equally to maintain a fair and competitive market.
- Switching suppliers: changing suppliers in a multi-supplier environment can become complex, for example the need for clear identification of metering and billing points and well-defined entry and exit procedures, including transparent rules and timelines to ensure a smooth and fair transition for all parties.
- Additional uncertainty: with customers engaging in multiple suppliers’ contracts, complexity and uncertainty arise about responsibilities, and complaint handling. Clearly defining responsibilities among market actors is essential to ensure transparency, protect consumer rights, and maintain trust in the system. It is essential to avoid risks as well as costs transfers between the different suppliers involved in a multiple supply situation. In countries in which suppliers play a DSO intermediary role for network costs, it appears a crucial point.
- Change in consumers’ profile: engaging in multiple suppliers’ contracts, when technically feasible, alter the customer’s load profile modifying the contract’s economic balance and existing supply contract by making forecasts inaccurate and deeply change the volume repartition within price periods. This misalignment risks causing procurement inefficiencies, financial exposure, and system imbalances. To prevent backlash, suppliers have to be notified of any new contracts that may affect consumption profile so that suppliers can adapt their contracts and forecasts.
