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Electricity grossly overpriced, study finds

The Local · 28 Dec 2010, 09:35

Published: 28 Dec 2010 09:35 GMT+01:00

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The study, reported in the Tuesday editions of the dailies Leipziger Volkszeitung and Saarbrücker Zeitung, found that 570 electricity suppliers around the country are passing on higher costs to customers in form of prices rises next year. But they are not passing on lower costs in other areas, the study claims.

“A pretext is being used here in order to conceal unjust price rises,” Bärbel Höhn, the Greens’ deputy parliamentary leader, told the papers.

From either January 1 or February 1, energy suppliers will raise prices by an average 7 percent – and in some cases by as much as 20 percent.

On the one hand, suppliers are justifying price rises on the fact that in 2011, an extra 1.5 cents per kilowatt hour tariff will apply to renewable energies. On the other, there was a “substantial potential for price drops that have so far not been passed on,” the study says.

For instance, procurement costs had fallen by 30 to 40 percent since autumn 2008 but this saving had not been passed on to customers.

“The suppliers are repeatedly raising the price in order to lift their profits,” said the Greens’ energy expert, Ingrid Nestle.

According to the study, the price rises were “incomprehensible.”

Under Germany’s feed-in tariffs system, which aims to make renewable energy 12.5 percent of the overall consumption in 2010 and 20 percent in 2020, renewables such as wind and solar attract surcharges to encourage development of technology.

Story continues below…

The report was compiled by energy economist Gunnar Harms, who is also deputy chairman of the Federation of Energy Consumers. It also reaches the conclusion that 2010 will be a record profit year for Germany’s four big electricity firms.

“The combined annual profit should be about €30 billion. Never before have they run such high profits,” Harms told the Saarbrücker Zeitung.

DPA/The Local/dw

The Local (news@thelocal.de)

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Your comments about this article

10:48 December 28, 2010 by auniquecorn
Of course there won´t be any political action taken, This government will profit along with the suppliers.
12:02 December 28, 2010 by freechoice
the introductions of electric cars will greatly reduced the demands for petrols next year, hence currently the gasoline price hikes is the result of this greedy acts by corporations. which in turn affects the power companies profit margins!! hence the consumer suffers. governments should arrest those profiteering corporate big wigs!!!!
13:45 December 28, 2010 by DinhoPilot
There is no escaping from the money sucking machine, its a fact. And the New year didn't even started. More good news to follow..
14:10 December 28, 2010 by auniquecorn
@ DinhoPilot

( Has´nt even started )

Sorry, but had to get ya.
15:02 December 28, 2010 by DinhoPilot
ma bad. It's the news stress ^^, thank your for the correction
20:44 December 28, 2010 by storymann
come on boys lets get it straight we are being raked over the f--king coales by he electric companies...are you going to haggle over a minor misspelling !!
22:23 December 28, 2010 by Gretl
This is news????
07:48 December 29, 2010 by DocEllis
The best thing and about the only thing we can do as consumers is stop buying their electricity and make our own, house by house, flat by flat. It can be done. In this day anbd age it can be done.

That is the only power we have. If we do not like the service or the product or the price do not buy it.
15:44 December 29, 2010 by derExDeutsche
This is the same Issue that got Gray Davis recalled in California. Govt. is fleecing you at the electricity meters, nothing new. Supposed shortages, environmental controls, fines and taxes.

Govt. funded Education has brainwashed enough people to believe that spending EVEN MORE for electricity will make everything all better. 'The sky is falling the sky is falling.' Meanwhile its cold as hell, and the is a price structure in place, is to artificially keep consumption lower/ prices higher. You know, because people won't need that much energy because the world is WARMING.
17:34 December 30, 2010 by derExDeutsche
German Electricity companies Deregulated? hardly.

2010 Warmest year on Record? Lol. NASA?! what does NASA do these days besides jockey for Govt. Global Warming research grants?
17:04 January 2, 2011 by SockRayBlue
So you get screwed in Europe just like we do in the US? Odd?
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