Energy suppliers to inform customers better about early-termination fees following an ACM investigation

Prompted by reports filed with ACM’s consumer information portal ACM ConsuWijzer, the Netherlands Authority for Consumers and Markets (ACM) conducted an investigation into six energy suppliers regarding their compliance with the rules on early-termination fees. The investigation revealed that these six suppliers do not always adhere to the rules. Five energy suppliers (Greenchoice, Essent, Clean Energy, Innova Energie, and Mega Energie) fully cooperated with ACM’s investigation, and immediately committed to taking measures to prevent future errors from occurring. These companies will inform their customers better about early-termination fees. Suppliers that wrongly collected early-termination fees have refunded these fees. ACM will continue its investigation into the one other supplier, and if necessary, will take enforcement action against this company.

Consumers that cancel their energy contracts for natural gas and/or electricity before the end of their fixed periods often need to pay an early-termination fee to their suppliers. In the summer of 2023, the rules on early-termination fees were changed. The amount of the early-termination fee is equal to the amount of the costs that the energy supplier incurs due to the early termination. If a customer cancels a fixed energy contract, the supplier must inform that customer straight away about whether they need to pay an early-termination fee. In that context, the supplier must also provide an estimate of the amount of the early-termination fee. It is important that energy suppliers inform their customers about this as quickly as possible, so that a switch to another supplier can still be undone if that consumer changes their mind.

Manon Leijten, Member of the Board of ACM, adds: “It’s often not clear to customers whether or not they need to pay an early-termination fee. As a result of this, people can be hesitant to switch to another supplier. That’s why it’s important that energy suppliers give their customers correct information about this straight away. It’s wonderful to see that five suppliers immediately corrected their errors.”

Outcome of the investigation

On the basis of complaints filed with ACM ConsuWijzer, ACM conducted an investigation into six energy suppliers. The investigation revealed that suppliers do not always provide customers that switch suppliers correct information about the early-termination fee on time. In addition, they sometimes charge an early-termination fee when such is not allowed. In addition, not all suppliers are sufficiently aware of the conditions regarding early-termination fees. ACM shared the outcome of the investigation with these energy suppliers. In response thereto, five of them (Greenchoice, Essent, Clean Energy, Innova Energie, and Mega Energie) took measures straight away to correct their errors and to prevent new ones from occurring. Suppliers that wrongly collected early-termination fees have refunded those fees. In total, the fees amounted to approximately 230,000 euros. With that, the investigation into these suppliers is closed. ACM will continue its investigation into the one other supplier. If necessary, ACM will take enforcement action against this company. In that case, ACM will also publish the name of the company.

Explaining the rules to suppliers and consumers

ACM has sent guidance to all energy suppliers in order to draw their attention to the rules on early-termination fees one more time, and to offer them more guidelines for complying with the rules. Consumers can visit the website of ACM’s consumer information portal ACM ConsuWijzer for more information about the rules. On ACM ConsuWijzer’s website, they will also find a sample letter that individuals can use if they their supplier does not comply with the rules.

Over the next several months, ACM will continue to enforce compliance with the rules on early-termination fees, and calls on consumers to keep on reporting any problems they encounter.

More information

• Guidance on early-termination fees (in Dutch)
• ACM: Making well-informed decisions about new energy contracts is hindered by uncertainty about resellers and early-termination fees | ACM
• Cancelling your energy contract: information about early-termination fees and notice periods | ACM ConsuWijzer (in Dutch)