Supplier of last resort and consumer: terms of cooperation

After the launch of the gas market for domestic consumers, every Ukrainian who uses gas will have to have an agreement with a gas supply company. If for some reason the consumer finds himself in a situation where he does not have a supplier, he will be provided with gas by the supplier of last resort (SoLR).

What kind of company it is, where it will come from, how the consumer will cooperate with it – Kosatka.Media found answers to all these questions.

What is the difference between SoLR and a guaranteed supplier? Why SoLR?

The current legislation in the gas sector does not provide for such a market participant as a guaranteed gas supplier. But the law establishes SoLR. That is why a supplier of last resort is choosen on a competitive basis.

Who chooses SoLR and how?

SoLR will be chosen as part of the competition. It is carried out by the corresponding competition commission, whose work is provided by the Ministry of Energy of Ukraine.

What are the features of the choice of SoLR in the gas market? Could it be any gas supply company?

The competition provides for a number of qualification requirements for participants. In particular, to have a license for gas supplies, to be able to provide a gas reserve of 3 514 million cubic meters of gas, which corresponds to the largest monthly consumption during the heating season 2019/20.

In addition, the candidate company must have a service infrastructure to ensure interaction with customers. The competition committee must choose the one that offers the lowest margin among the participants who will meet these requirements.

How long will SoLR guarantee gas supplies to people?

Now it is assumed that SoLR has to supply gas to customers during 60 days.

How will the consumer switch to SoLR? What will the buyer need to do?

According to the current procedure, a client who, for any reason loses a gas supplier, will have to contact the supplier of last resort to provide basic information (identification documents, identification number, documents on ownership of the gas supply facility and the last payment for distribution (supply) of gas).

Market participants have hope that NEURC will improve this procedure before the end of PSO and make it more convenient both for consumers and for practical implementation for SoLR.

Will SoLR’s gas really cost more to the consumer? How will gas prices be formed?

It is assumed that the gas price from SoLR will be at the market level and will not limit competition in the market.

SoLR will be required to provide its consumers with gas price information.

How will the consumer interact with SoLR? Will it send new biils? How to find out that this is the official bill, and not some scammers seized the moment?

After the announcement of the winner of the competition, information on the company's activities will be posted on SoLR website. With this data, consumers will be able to further verify the data in the bill received.

In addition, if the current supplier is unable to complete the delivery, it must notify his customers about this, advise him to choose a new supplier in advance and talk about SoLR mechanism as an extreme solution to the situation.

In any case, it is worth checking the information in official sources, if there are doubts.

To recap, the work of gas suppliers is controlled by NEURC. You can contact the National Regulatory Commission for clarification.

How to finish cooperation with SoLR, if a consumer has found a new gas supplier?

If the client wants to stop using SoLR services, he has the right to initiate the termination of the contract at any time.

Then, the consumer needs to use the updated supplier change procedure, which is valid from July 1 2020. According to it, a person needs to apply for joining a new supplier, provide it with the necessary package of documents and wait for a message about joining the selected supplier.

Read more: How to change the gas supplier and where to find it

What awaits the consumer after the end of delivery time by SoLR, if the consumer has not signed a contract with a new supplier?

After the maximum gas supply term has expired with SoLR, the client must transfer to another gas supplier. Experts suggest that this time should be enough to find a new supplier.

If during this time the consumer could not or did not want to find a new supplier, measures should be taken to stop the distribution and transportation of natural gas in accordance with the terms of the Code for gas distribution systems and the Code of gas transmission system.

Specialists of the gas supply company Naftogaz of Ukraine helped Kosatka.Media dealing with the nuances of SoLR.


Tags: gas, legislation, NEURC, Gas market, price, gas supplies

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