The first step towards liberalising the electricity market was taken in 1995, with the publication of a legislation package to transpose Directive 96/92/CE of the European Parliament and Council, of 19 December 1996. This package introduced in national legislation the concept of third-party access to the grid, meaning that competition in supplying electricity to customers became possible, allowing a supplier to forward electricity to its customers through networks owned by another agent, by paying a regulated (access) tariff in exchange for this service.
This same package created the ERSE, the regulator for the electricity sector (a field that would subsequently be extended to the natural gas sector), which is responsible for developing the necessary regulations to introduce effective competition in the electricity sector, including the regulation of activities that correspond to natural monopolies (electricity grids) and third-party access to grids. ERSE made third-party access to the grid operational by publishing the Agreement on Network Access and Operation, in 2010, and the right to choose one's supply was granted to an ever-increasing range of customers, until the market was fully liberalised in September 2006.
IBERDROLA started to operate as an electricity seller in 2002. By the end of the year 2010, it was already providing around 27% of electricity in the liberalised market, which corresponds to around 11% of total consumption in continental Portugal, leaving IBERDROLA in the second position in the ranking of utilities selling electricity.