Free-Market Electricity Has Cost Households More Than the Regulated Tariff Since Mid-2023, ERSE Finds, Though Cheaper Offers Were There

Households on the free electricity market have, on average, been billed more than customers on the regulated tariff since the middle of 2023. ERSE (Entidade Reguladora dos Serviços Energéticos, the energy regulator) says the reason is not a lack of cheaper deals. Every quarter of 2025, between 20 percent and almost 40 percent of the offers on the market undercut the regulated price. Many households are simply still paying for older, dearer contracts.

The findings come from the second edition of ERSE's report on average billed prices and commercial margins in the retail electricity market, which covers 2021 to 2025 and was published on Wednesday.

What the report found

• A gap since mid-2023. For households, the average prices billed by the last-resort suppliers (the comercializadores de último recurso, or CUR, which charge the regulated tariff) have been "systematically below" the average prices billed on the free market since the middle of 2023. The gap was widest in the third quarter of 2024, and narrowed through 2025 as free-market prices fell.
• Cheaper offers were there. In every quarter of 2025 there were offers below the regulated tariff, measured on the monthly bill including taxes. They made up between 20 percent and almost 40 percent of the offers available, depending on the quarter and the type of household.
• Old contracts. ERSE says the fact that average free-market prices are still higher points to "many customers on old contracts with higher prices than the new offers". It sees "some inertia among consumers about changing supplier", which limits the benefits of the free market.
• Fixed prices dominate at home. In 2025, 98 percent of the electricity sold to households on the free market was at a fixed price. Large customers bought 83 percent of their energy on contracts indexed to market prices. ERSE notes that households, on fixed prices, were slower to feel the price rises of 2021 and 2022, but were also "the last segment to adjust prices downward" when market prices fell again.
• Suppliers' margins. The margins suppliers earned on household and small-business customers were positive throughout 2025, ERSE says.

How much a switch could save

ERSE's latest bulletin of commercial offers, for the third quarter of 2026, shows the gap from the other side. It is based on the offers in ERSE's price simulator in the second week of August. In it, 22 suppliers offered electricity to homes, with up to 321 offers per household type. Between 7 and 12 of those suppliers had at least one offer below the regulated tariff, depending on the household. Comparing the cheapest electricity-only offer with the regulated tariff, ERSE found these possible annual savings:

• a couple without children (1,900 kWh a year, 3.45 kVA contracted power): 48 euros a year, about 11 percent;
• a couple with two children (5,000 kWh, 6.9 kVA): 123 euros a year, about 11 percent;
• a couple with four children (10,900 kWh, 13.8 kVA): 313 euros a year, about 12 percent.

Dual electricity and gas offers saved far less: at most 29 euros a year, and nothing for the smallest household. Several of the cheapest offers are for new customers only, or come with conditions such as a partner membership or direct debit and electronic billing. The bulletin predates the 2.7 percent rise in the regulated tariff on 1 October, and the regulator has proposed a further rise of about 1.5 percent in January.

What households can do

• Check your bill. ERSE says a free-market supplier's bill must show the difference between what you are paying and what you would pay at the regulated-equivalent price.
• Compare offers. ERSE's energy price simulator lists the offers available for a given consumption and contracted power. ERSE advises customers on older contracts to negotiate new terms with their current supplier or to switch.
• Ask for regulated prices. Under Lei n.º 105/2017, a household with up to 41.4 kVA of contracted power can ask its free-market supplier for "regulated price conditions", ERSE explains. The supplier must answer within ten working days. If it says no, it must say so in writing, and you can then sign a contract with the last-resort supplier. In that case you pay no penalty for leaving a contract with a minimum term.

The regulated tariff is set by ERSE every year and is currently expected to remain in place until the end of 2027. Households that qualify for the electricity social tariff get its discount on either market.