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Electricity: Consumers must reckon with price surges at the beginning of the year


The energy crisis not only affects the gas market, but also the electricity market - and thus every individual. More and more utilities are now passing the increased wholesale prices on to consumers.

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Power lines: nationwide price increases

Photo: Michael Gstettenbauer / IMAGO

For many households, the coming year will begin with a drastic price hike.

In Cologne, for example, the supplier Rheinenergie will charge more than twice as much per kilowatt hour as of January for the basic supply: around 55 cents will be due there in the future – an increase of almost 130 percent.

Rheinenergie is not an isolated case: "The new year begins with a massive wave of price increases for electricity," says Thorsten Storck, the energy expert at the comparison portal Verivox.

Basic suppliers would now have to gradually pass on the higher market prices to their customers.

Rheinenergie also refers to the high procurement costs, which are increasingly reflected in the company's long-term purchasing strategy.

»Compared to the previous year, the prices on the electricity exchanges have risen by more than 300 percent, at their peak they had increased more than tenfold.

In addition, the network fees are also increasing«, the company explains the price jump.

7.3 million households affected

The extreme rise in gas prices as a result of the Russian war of aggression against Ukraine is considered to be one of the main reasons for the rise in electricity prices.

In wholesale trading, the now expensive generation of electricity from gas-fired power plants often determines the price of electricity for all other types of generation.

According to the comparison portal Check24, more than 580 providers have already announced price increases for basic services at the turn of the year.

“Around 7.3 million households are affected,” reports the company.

The increases amount to an average of 60.5 percent.

Verivox comes to an average plus of 54 percent because of a different data basis.

"The electricity price increases at the turn of the year are sometimes drastic," says Udo Sieverding, the energy expert at the consumer advice center in North Rhine-Westphalia.

"Unfortunately, the tariffs for new customers via the brokerage portals are even higher, so switching providers doesn't bring any savings in most tariff areas." This is only likely to change in the course of the next few months.

Customers in the basic service therefore currently have no choice.

Basic care becomes cheap

"In the event of price increases, customers outside of the basic service should even consider making use of their special right of termination and falling into the basic service," advises the consumer advocate.

The basic service tariff used to be considered a rather expensive tariff.

In some places it is already below the special tariffs of other providers.

The price increases at the beginning of the year vary greatly across Germany.

For example, the Stadtwerke in Potsdam (Brandenburg) are increasing prices by around 21 percent to 46.5 cents per kilowatt hour.

At MVV Energie in Mannheim (Baden-Württemberg), just under 45 cents are due for the basic supply from January – instead of the previous 27 cents.

The East German energy supplier EnviaM (Chemnitz, Saxony) will in future charge 48.1 cents, 20.1 cents more than before.

In addition to Cologne, the increase is also hefty in Munich: in the basic supply of the municipal utility, a kilowatt hour will cost 61.9 cents from the New Year.

Previously it was 25 cents.

The significant increases at the turn of the year are not the first in the recent past: According to calculations by Check24, a model household with an annual consumption of 5000 kilowatt hours (kWh) paid an average of 29.4 cents per kWh in November 2020.

A year later it was 31.6 cents.

Currently (November 2022) the average is 42.7 cents.

The burden of high electricity prices is to be cushioned by the electricity price brake.

In the case of households and small companies, the price for 80 percent of the previous year's consumption should be capped at 40 cents per kilowatt hour.

If the customer consumes more, he pays the normal contract price.

This should give an incentive to save.

The suppliers should take the electricity price brake into account in the deductions from March.

The brake should then also apply retrospectively to January and February.

Many details still need to be clarified before the corresponding law can be passed.

Consumer advocate Sieverding also fears abuse.

"We do not rule out that one or the other company uses the price brakes to increase more than is absolutely necessary." There is a ban on misuse in the draft law.

'But who's going to seriously check that?

And besides, the providers could now increase in January before the law comes into force.«

The electricity market expert Mirko Schlossarczyk from the consulting firm Enervis does not assume that electricity prices for households will fall back to the level before the Ukraine war in the coming years.

On average, he calculates well over 40 cents per kilowatt hour gross.

For 2023 and 2024 and also in the years after.


Source: spiegel

All business articles on 2022-11-25

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