A supply licence is the authorisation of the Authority for Consumers and Markets (ACM) required to supply electricity or gas to small consumers – households and small businesses. Supplying to large consumers is free; supplying to small consumers without a licence is prohibited and enforceable.
Statutory basis
The licence requirement was contained in article 95a of the Electricity Act 1998 and article 43 of the Gas Act and has been continued in the Energiewet since 1 January 2026. The assessment criteria and the ongoing financial monitoring are worked out in the Energiebesluit and in ACM policy rules on reliable supply and the continuity of energy suppliers, which were tightened after several suppliers failed.
How it works in practice
The applicant must show that it has the organisational, financial and technical capacity to supply reliably, that its directors and holders of qualifying interests are of good repute, and that its administration, hedging policy and customer processes are in order. After grant the ACM monitors continuously: suppliers file periodic financial reports and must notify significant changes. The ACM can impose conditions, an order subject to a penalty, or a fine, and can withdraw the licence, in which case customers are transferred to other suppliers.
Where it goes wrong
The requirement catches parties who do not think of themselves as suppliers. A landlord, a property manager, a campsite or a business park that resells electricity through a private network to end users can fall within the definition. Exemptions exist for supply behind a private network in limited circumstances, but they are narrow and depend on the metering arrangement and the pricing. The second frequent failure is on hedging: an unhedged book with a fixed-price offer to consumers is precisely the profile the ACM now tests for.
Related terms
Connection and transport agreement, Energy Act and power purchase agreement.
Are you setting up as a supplier, or resupplying tenants or occupiers? Our energy lawyers assess the licence requirement and prepare the application.
