Czech consumers may terminate energy contracts if suppliers have not secured supplies

As of today, consumers can terminate a contract with an electricity or gas supplier with whom they have fixed a price if the supplier has not secured at least 70 percent of their expected consumption. This follows from an amendment to the Energy Act that enters into force today. The Energy Regulatory Office (ERÚ) pointed out that under the law, energy traders are required to publish a supply coverage index twice a year.

"The supply coverage index is a single figure with two benefits. When switching suppliers, consumers have another piece of information to consider in their decision. For example, they can see that a particular trader offers a very low price but has also bought less energy in advance," said Markéta Zemanová, a member of the ERÚ board.

"It also means that if we have fixed the price of our electricity or gas and the supplier has not secured at least 70 percent of the energy for us in advance for that period, we can terminate the contract. We can also give notice if the trader does not publish the index by the statutory deadline," Zemanová added.

The option to terminate the contract applies to households and self-employed individuals. The ERÚ has published a sample termination notice on its website.

Energy suppliers must publish the supply coverage index twice a year, at the end of March and at the end of September. They must publish the figure on their websites and also provide it to the ERÚ. The law introduced this requirement in response to the collapse of Bohemia Energy in 2021. According to the ERÚ, the company failed as a result of inadequate hedging of supplies amid a sudden surge in energy prices.