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Customers wasting billions on electricity

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Customers wasting billions on electricity
Photo: DPA
09:07 CEST+02:00
Germans could save billions on their electricity bills if they would simply change power providers, according to a special report published by the Monopolies Commission.

The Frankfurter Allgemeine Zeitung reported the survey, which compared prices across the country, showed that a three-person household using 4,000 kilowatt hours paid an average of €1,091 a year when using the regional provider.

That is €295 a year more than the cheapest alternative provider would charge, the paper said – and added that the rock-bottom prices achieved with pre-payment schemes were not even included in the calculation.

The 27-percent price difference is important as around 45 percent of all households still do not take advantage of the liberalisation of the electricity market, but have stuck with their expensive providers.

In 41 percent of cases customers have changed the tariffs they pay, but not the provider, while only 14 percent of those surveyed had changed the company from which they buy electricity.

The Monopoly Commission also looked at which provider was the cheapest – and found that municipal-run regional providers and the four largest firms – Eon, RWE, Vattenfall and EnBW - were not the best-priced.

“In nearly 99 percent of all cases, these are private providers which are not run by the municipalities, and which do no belong to one of the four big energy firms,” said head of the Commission Justus Haucap.

“The cheapest tariff was only found 11 times among the municipal providers and only 67 times from a provider owned by one of the four big energy firms.” Even the second-cheapest tariff was only very seldom – in around one percent of cases – offered by municipal providers – although the four big firms accounted for 10 percent of these.

The commission thus questioned the current practice of municipal-controlled firms buying back electricity generating stations and provision networks.

Competition in the German electricity and gas market has increased over the last two years, said the report, not least due to the shut down of the nuclear power stations, which is pushing the share of the market held by the four big providers down to less than 80 percent, the FAZ said.

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