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Glossary
Basic supply

The basic supply in the energy market ensures that all households and smaller commercial customers are supplied with electricity and gas, even if there is no individual supply contract. In Austria, the basic supply is regulated by local suppliers.

10/21/2024

The universal service is an important part of the energy market in Europe and Austria. It ensures that all household customers and small commercial enterprises are continuously supplied with electricity and gas. This is a type of "emergency supply" that comes into effect in particular when there is no individual contract between the customer and an energy supplier. This concept is very important to ensure that there are no gaps in the energy supply, even if a customer changes supplier or a supplier ceases operations.

In Austria, the basic supply is regulated by the Electricity Industry and Organisation Act (ElWOG) and the Gas Industry Act (GWG). These laws ensure that all energy suppliers are obliged to supply energy to households and small businesses that have not concluded any special contracts under the conditions stipulated by law. These tariffs must be fair and transparent, which means that they must not be excessive, but also that they must not be subsidised.

A key aspect of the basic supply is its reliability. Even in times of market upheaval, such as the bankruptcy of a supplier or a change of contract partner, customers' energy supply remains secure. In such a case, the so-called "local basic supplier" steps in - this is usually the company that is traditionally responsible for the energy supply in the region. In Austria, these are often regional suppliers such as Wien Energie or Energie Steiermark. These companies are obliged to take over the supply without interruption and at the conditions of the basic supply.

Basic supply tariffs are regularly reviewed by the relevant authorities, such as E-Control in Austria. This ensures that the energy suppliers' prices remain fair and in line with current market developments. For customers using the basic supply, prices are often somewhat higher than for individually negotiated contracts, as these offers generally provide standard conditions without additional price advantages. Nevertheless, the basic supply offers a high level of security of supply, which is particularly important for consumers who do not want to actively switch supplier or do not want to deal with the energy market.

In a European comparison, Austria has a well-organised basic supply. The role of the universal service in securing energy for all citizens is recognised by the Austrian authorities and energy suppliers alike. Even though market liberalisation has promoted competition on the energy market, the universal service remains an essential element in ensuring a fair and reliable distribution of energy.

In addition to security of supply, the social component of the universal service also plays an important role. The legally defined conditions are intended to prevent customers from being left without energy in difficult economic situations. In some cases, there are special protective measures for socially vulnerable households to ensure that a minimum supply of electricity and gas is guaranteed even in the event of payment difficulties.

The basic supply is also important for the energy market in Austria because it serves as the basis on which other competitive offers are built. Customers can switch from the basic supply to a cheaper tariff at any time, which opens up the market to alternative suppliers and promotes competition. In practice, however, many customers do not actively switch out of the basic supply, which is partly due to a lack of knowledge about the energy market or satisfaction with the supply.

To summarise, the basic supply in the Austrian energy market is an essential mechanism for guaranteeing a nationwide, secure and fair energy supply. It not only offers protection against supply bottlenecks, but also contributes to social justice by providing all citizens with the necessary energy resources - regardless of their financial situation or market experience. At a time when the energy market is becoming increasingly complex, the universal service remains a reliable pillar for many households in Austria and beyond.

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