Can the energy supplier change the rates in the contract?

Electricity price rises and energy legislation

A unilateral price change by an energy supplier is legally permissible only if certain conditions are met. Under the Energy Law, the supplier must justify the reason for the change and comply with information procedures. What does this mean in practice?

• Tariffs approved by the Energy Regulatory Office (URE): If you are on a regulated tariff (e.g. a household on the G tariff), any change to the electricity rate requires prior approval from the President of the Energy Regulatory Office (URE). The URE checks whether price increases are justified by costs and comply with the regulations. The supplier cannot change prices arbitrarily during the year – new tariffs are usually approved once a year or every six months and can only come into effect after being announced by the URE.
• Market contracts (non-tariff price lists): In the case of contracts concluded on the free market (e.g. a promotional electricity price guaranteed for a fixed period), the supplier may include clauses in the contract regarding price changes, but only for a valid reason specified in the contract. Importantly, even if such a clause is included, the consumer should be guaranteed the right to terminate the contract if they do not accept the new prices. Clauses allowing the company to change the price without the customer having the option to withdraw are considered unlawful (unfair) and are not binding on the consumer.

The supplier’s obligations when changing rates

If an energy supplier decides to raise prices, it must fulfil its information obligations towards the customer. From August 2024, stricter provisions of the Energy Act will apply, which precisely regulate the deadlines and form of notification:

• Households: The electricity supplier must inform the consumer at least one month before the planned change in prices or tariffs. The notification should be provided in a clear and comprehensible manner, stating the reasons and conditions for the change, and including information on the right to withdraw from the contract.
• Other end users (businesses): For business customers, this period is slightly shorter – a minimum of two weeks before the change comes into effect.

Any price increase must include information on the right to terminate or withdraw from the contract; in open-ended contracts, termination is possible without penalty, whilst in fixed-term contracts, termination takes effect at the end of the notice period. Pursuant to Article 5(5) of the Act, the absence of such information renders the changes non-binding, unless they result from tariffs approved by the Energy Regulatory Office (URE).

Changes to energy prices for individual consumers (household customers)

Individual energy consumers are subject to strong legal protection – the supplier cannot arbitrarily raise prices during the term of the contract, unless this results from a tariff approved by the Energy Regulatory Office (URE) or circumstances expressly provided for in the contract.

• Open-ended contract (G tariff): The price usually changes following the approval of a new tariff by the Energy Regulatory Office (URE). The supplier must give 30 days’ notice of the change, and the consumer may then terminate the contract.
• Fixed-term contract with a price guarantee: The price remains fixed for the duration of the contract. Exceptions are situations provided for in the contract itself, e.g. an indexation clause or changes in taxes. In such cases, the consumer must be able to withdraw from the contract. An unlawful price increase may constitute grounds for a complaint and intervention by the Office of Competition and Consumer Protection (UOKiK).

Changes to energy prices for businesses

Businesses are not covered by consumer protection, but are subject to the Energy Law and the general principles of civil law.

• Open-ended contracts: The supplier may change prices (e.g. due to higher costs), but must notify the business in advance – at least 14 days. The business may accept the new rates or terminate the contract. The Energy Law guarantees that in such a situation, the business will not incur any additional costs beyond payment for the energy consumed.
• Fixed-term contracts: Prices are fixed for the duration of the contract; the supplier may not unilaterally increase them unless the contract contains valid indexation clauses or other explicit provisions. Pursuant to Article 4j(3a) of the Energy Law, an end user may terminate a fixed-term contract by submitting a notice, bearing only the costs and compensation arising from the terms of the contract. In the case of households and micro- and small enterprises within the meaning of Article 7(1)(1) and (2) of the Entrepreneurs Act, to the extent that they consume energy/fuels for the purposes of their core business, the total amount of such costs and compensation may not exceed the ‘amount of direct economic losses’ incurred by the supplier as a result of the termination of the contract.
• Medium-sized and large enterprises: The statutory limit on the amount of fees “to direct economic losses” under Section 4j(3a) of the Energy Act does not apply to medium-sized and large enterprises — this limit applies exclusively to households and micro- and small enterprises within the meaning of Article 7 of the Entrepreneurs Act. Consequently, in the event of early termination of a fixed-term contract, the contractual provisions regarding fees/compensation apply. Therefore, early withdrawal from the contract may entail substantial penalties. In particularly exceptional circumstances — in the event of an extraordinary change in circumstances — a party may seek a court order to modify the manner of performance, the amount of the consideration, or to terminate the contract pursuant to Article 357¹ of the Civil Code; however, this is generally a measure of limited effectiveness, intended for cases meeting strict criteria.

What should you do if your energy supplier changes its prices?

1. Analysis of the notice – check the effective date and the amount of the planned increase, as well as its basis (e.g. a decision by the Energy Regulatory Office, a tax change, or a rise in costs). The notice should include information on the right to terminate or withdraw from the contract.
2. Check the contract – it is worth reviewing the clauses regarding price changes and the notice period. Provisions restricting the right to cancel in the event of a price increase are invalid by law.
3. Comparison of market offers – a price increase may be an incentive to consider switching energy suppliers. The procedure is free and relatively straightforward; however, before terminating the current contract, you should ensure that a new contract has been concluded or that a backup supply has been secured.
4. Negotiations and legal assistance – for businesses, it is advisable to enter into discussions with the supplier, and in the event of a dispute, to lodge a complaint or seek assistance from institutions such as the Energy Regulatory Office (URE), the Office of Competition and Consumer Protection (UOKiK) or the Consumer Ombudsman. In more complex situations, it is worth seeking legal advice.

Changes to energy rates in the contract – Summary

Changes to energy prices during the term of the contract are only possible in strictly defined cases and after fulfilling the supplier’s duty to inform the customer.

Are you in a dispute with your energy supplier and need legal support? Our lawyers will thoroughly analyse your contract, verify the grounds for the price increase and suggest possible solutions. Contact HWW Hewelt Wojnowski Lindner i Wspólnicy – we have been assisting both consumers and businesses in matters relating to energy law for many years.