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Loss of more energy suppliers in Brussels prompts competition concerns

10:26 06/01/2022

Following the recent departures of two energy suppliers, only three operators remain on the market in Brussels, prompting concerns about harmful consequences for customers.

“Nothing would prevent a supplier from charging higher prices than in other regions if it had a dominant position or monopoly on the Brussels market,” Julie Frère, spokeswoman for the consumer organisation Test-Achats, said.

And a monopoly does not seem too unlikely with the departure of yet another supplier from the market. Gas and electricity supplier Octa+ has informed its 17,000 Brussels customers that it will cease operations, not long after the closure of Méga.

But Frère said there was no need to panic just yet: “All this is regulated by competition law. You cannot abuse your dominant position by charging unfair prices, but this should be discussed. We’re not there yet.”

Brussels energy minister Alain Maron points to broader trends of soaring gas and electricity prices as the culprit.

“There is great tension on the international gas market with prices that are extremely high,” Maron said. “The same goes for electricity. This is putting a number of small energy suppliers in difficulty, forcing them to sell their energy at a lower price than what they have bought.”

Earlier this week in Flanders, struggling energy supplier Wats filed for bankruptcy, making it the third supplier to find itself in difficulty due to high energy prices after Energy2Business and Vlaamse Energieleverancier, both of which also went bankrupt.

Energy customers need not worry about their lights turning off thanks to a mechanism in place that prevents the interruption of energy supply by automatically switching consumers to a “default supplier” (Engie in the Brussels region) when a contract is terminated.

Afterwards, consumers are urged to compare prices and choose a new supplier. Residents of Brussels now only have three to choose from. 

Rising energy prices aside, critics say that legislation requiring energy suppliers to go before a justice of the peace before initiating proceedings to recover unpaid debts hardly entices providers.

Maron said he was working on regulatory reforms that will address some of the complaints that legislation is “too protective” of consumers. 

“The regulatory framework in Brussels will be modified,” Maron said, explaining that draft legislation “aims to guarantee access to energy for a maximum number of Brussels residents by eliminating, for example, budget meters, while ensuring that the burden of debts that suppliers may incur is not borne exclusively by them.”

The idea is that when a customer has difficulty paying the bill and defaults on payment, they’ll be switched to a default supplier until they complete a debt settlement plan.

The default energy supplier would also no longer be one of the private operators present on the market but the intermunicipal company Sibelga. 

Written by Helen Lyons