A reform set to change the market
The 24-hour supplier switching marks one of the most important reforms in the gas and power sector in recent years. Customers will be able to choose their operator in just one business day, accelerating competition and simplifying the underwriting process. For consumers, the outlook is clear: more flexibility, reduced time and greater transparency. For companies in the industry, however, the scenario is much more complex, with direct repercussions on credit management, information systems and customer retention strategy.
Reform is not just a matter of speed, but represents a real revolution in business processes, with real effects on delinquency risk, the resilience of legacy systems, and the efficiency of collection procedures. Those who can adapt first will be able to turn these challenges into competitive advantages, while those who remain tied to traditional models are likely to suffer significant consequences.
Immediate impacts on credit management
Rapid switching between suppliers drastically reduces the time available to monitor customers and prevent insolvencies. Tools such as CMOR (Morosity Charge), designed to compensate suppliers for outstanding receivables, are in danger of becoming insufficient. The speed of processes forces utilities to enhance their ability to detect critical situations in advance and adopt predictive systems to assess creditworthiness.
Financial flows move in real time, making faster and more reliable control procedures essential. Proper data management becomes strategic, as any delays or errors can result in incorrect billings, disputes and deferred collections, increasing pressure on financial teams and corporate cash flow.
One of the first impacts relates to credit management. The current payment collection and recovery model is based on longer switch times, which allow for a greater ability to monitor debt positions. With the introduction of the one-day switch, suppliers will face an acceleration of processes that significantly reduces the time available to intercept risky behavior. The CMOR procedure, which was created to protect providers in case of insolvencies related to switching, risks becoming inadequate if the speed of customer migration increases without a parallel strengthening of prevention mechanisms.
Energy tourism and delinquency risk
Included in this scenario is the phenomenon of so-called energy tourism, i.e., the tendency of some customers to move quickly from one supplier to another, leaving behind past debts. Currently about 14-20% of customers have late payments, and this percentage could grow in an accelerated switch scenario. With the ability to switch providers in as little as twenty-four hours, this phenomenon could intensify and generate growth in bad debts.
To limit exposure to default risk, it becomes critical for suppliers to implement predictive monitoring systems, capable of identifying at-risk customers prior to contract signing, and more sophisticated credit management strategies, integrated with advanced analytics. Only in this way will companies be able to contain impaired receivables and ensure continuity of cash flows.
The strategic role of the IIS
Alongside the issue of credit, that of flow management and data updating emerges. The Integrated Information System(IIS) becomes the centerpiece of the new architecture: it must ensure real-time validation and exchange of information between operators and distributors. Any error or delay, in the context of minimized timeframes, can result in incorrect billing, disputes and further delay in collections.
This forces utilities to invest in technology infrastructure capable of immediate dialogue with the IIS, strengthening data quality and consistency. In practice, a company’s ability to withstand the challenge of the 24-hour switch will depend on the robustness of its digital ecosystem.
Legacy information systems: a brake on competitiveness
Here another crucial node comes into play: pressure on legacy IT systems. Many companies still operate with management platforms that are layered over time, inflexible and often not designed to support high volumes of real-time transactions. The new scenario forces them to make a stark choice: upgrade or replace these systems, or risk not being competitive. Integration with modern platforms, the adoption of cloud architectures and the use of artificial intelligence tools are no longer ancillary options, but preconditions for ensuring security, scalability and operational consistency.
All this takes place in a market that will see a significant increase in the level of competition as a result of the reform. The speed with which a customer will be able to leave one provider to choose another will increase pressure on the churn rate and make it more difficult to retain users in the long run. Utilities will have to shift from a price-driven rationale to a strategy based on loyalty, building valuable relationships through personalized experiences, differentiated services, and targeted communications. In other words, the risk of insolvency will not only be addressed with more efficient recovery mechanisms, but also with retention policies capable of strengthening the relationship with virtuous customers and reducing volatility.
Operational criticalities and the role of ARERA
From an operational perspective, the 24-hour supplier changeover represents a real stress test for internal processes. Suppliers will be forced to adopt advanced tools to monitor debt positions in real time and segment bids based on predictive models. In parallel, ARERA has already let it be known that it will closely monitor the evolution of the reform, reserving the right to intervene if unfair practices or excessive imbalances emerge. This stringent monitoring aims to balance increased competition with the need to protect the sustainability of the system and ensure market stability.
Opportunities: turning challenge into competitive advantage
Yet behind these critical issues also lie significant opportunities. The 24-hour switch can be the catalyst that drives companies to truly innovate, abandoning the ballast of outdated systems and paving the way for digital and predictive credit management. The use of advanced analytics and artificial intelligence can make it possible to intercept weak signals of risk, profile customers more accurately, and come up with personalized offers that can build consumer loyalty more effectively. At the same time, the speed of procedures could turn into a competitive advantage for those players who can adapt first, offering a smooth and reliable experience in an environment where any delay becomes intolerable.
Conclusion: risk or opportunity?
In conclusion, the 24-hour switch reform marks the beginning of a new era for the utility industry. The promised speed brings with it massive challenges on the credit, ICT and customer management fronts, but at the same time it offers the opportunity to rethink outdated business models. Those who invest in advanced digital systems, data quality and loyalty strategies can turn this revolution into an opportunity to consolidate their market position. For others, however, the risk will not only be losing customers, but seeing the very ability to collect their receivables fade away.
