All you need to know about the duration of an electricity or gas contract

You have probably already noticed that the length of an energy supply contract varies according to supplier and deals. But do you know what it means and which is the most beneficial?

Index

• Minimum duration of supply contracts
• Usefulness of the duration of contracts
• Period of notice
• Abolishment of termination and regularization fees
• Cooling-off in the case of signature
• Conclusion: the term restricts the supplier above all

Choosing an energy supplier and perhaps changing to benefit from the best electricity and/or gas deal on the market may seem complicated administratively. And yet, nothing could be simpler: the new supplier takes care of everything. What should be known before opting for a particular deal is the period during which you can enjoy the prices of kWh of electricity or gas stipulated. In this way, there will be no surprises in the coming months!

Minimum duration of supply contracts

In Wallonia and in Flanders, the duration of contracts varies according to the energy supplier. The consumer can opt for contracts of one, two, three, or even five years with some suppliers. However, in Brussels, the minimum length of a contract for a private individual is three years but may also be longer depending on the supplier.

Did you know? Once your contract has expired, it is automatically renewed for a period of 12 months, regardless of the region! This means that the supplier will apply the rates applicable in the month of renewal, which will inevitably differ from those that you had before. However, if you benefit from a promotion, it is quite likely to be no longer eligible upon renewal. So keep an eye out and compare gas and electricity rates at least once a year.

Usefulness of the duration of contracts

As soon as you sign an electricity or gas contract, the rate applicable is applied for the duration of the contract.

In the case of a fixed rate, the annual fee (€/year) and the price of energy (c€/kWh) cannot be changed under any circumstances. Thus, throughout the contract, you will be protected against any increase in energy prices. That’s why we recommend you sign a long-term contract, even if it means breaking it if the price of energy goes down.

For a variable rate contract, this indexing formula cannot be changed. In other words, the margin that the supplier takes on your power supply cannot change, and neither can the fee. Only the index of the formula will vary with stock quotes. Therefore, the variable rate allows you to follow market variations while blocking the margin that the supplier will receive.

Contributions to renewable energy are adjusted each year by the supplier, whether you have a fixed or a variable rate.

We draw your attention to the fact that other items in your bill such as transmission rates and taxes are not directly related to the supplier. They may be subject to change during the validity of the contract and each supplier is obliged to apply the changes to its customers. These other items in your energy bill are thus strictly equal among all providers.

Moreover, the supplier is free to cease to supply in the event of non-payment of bills. In this case, the supplier decides to terminate the energy contract between the two parties and a notice of closure must be sent to the customer with a variable length of notice according to the regions.

Period of notice

The time needed to change from one supplier to a new one takes at least one month, though it may sometimes vary. For example, if you change your supplier on 20 August, you will receive delivery on 1 October in order to facilitate the understanding of future bills as they will account for a month’s consumption each time.

You can also request delivery as of a certain date as long as the minimum of one month’s notice is respected. However, according to suppliers’ terms and conditions, the maximum period between the contract signature and the first day of supply may also vary.

Once notification has elapsed, your distribution system operator will ask you to inform as to your meter readings so that your former supplier can send you the settlement invoice, also known as regularization. Your new service provider will also record this information in order to bill you for the energy consumed as accurately as possible.

Abolishment of termination and regularization fees

Since September 2012, termination fees have been abolished for individual customers and small business customers. So, even if you do reach the end of your contract, the regularization sent by your former provider will no longer make mention of this fee. It will only take account of the difference between the payments you have previously made and the total amount of your bill calculated, based on your actual consumption.

In the event of payment of excess amounts, you will receive a credit note and a reimbursement and In the event of underpayments, you will be required by the supplier to pay the difference in order to close your account.

Did you know? If you leave your property before the end of your energy contract, you need not respect any notification. However, you must send an energy transfer document (PDF) to your supplier. This is to be completed by you and the person who will take over the electricity and/or gas meters in their name.

Cooling-off in the case of signature

When you sign a new contract, you are granted a legal cooling-off period of 14 working days from receipt of the confirmation of contract (electronically or by post). This applies to electricity as gas throughout Belgium. In order to cancel, simply fill out the cooling-off form and return it by mail or you can also send an e-mail requesting acknowledgement of receipt.

If your contract is active for more than 14 days, you have the option of terminating your contract at any time without a termination fee, however, you are obliged to respect the minimum notice period of one month.

Conclusion: the term restricts the supplier above all

The terms of a supply contract are more binding for the supplier of electricity and/or gas than for the end customer. You are therefore under no obligation to honour the entire length of contract. In other words, you can terminate your contract at any time regardless of your provider, whatever the duration of your contract, without giving any specific reason. This legislation applies to individual consumers and small professionals connected to the low voltage network.

Now, as a consumer, you can play the competition and take advantage of the liberalization of the energy market so as never to receive big energy bills. For the best electricity and gas rates as well as the best promotions, feel free to make a comparison of the prices charged by suppliers or to contact us either by e-mail or by telephone on 0800 37 456.