Favorable tariffs attract new customers
Change electricity and gas provider now?
By Laura Esslinger and Victoria Robertz
02/19/2023, 7:25 p.m
Electricity and gas prices are falling. Switching from the basic supply to another electricity or gas provider can therefore be financially worthwhile again. However, those who want to change should keep these points in mind.
Electricity and gas procurement costs for energy companies have been falling significantly since December. This is now also reaching consumers. Gas prices are currently at the pre-war level, and according to comparison portals, the tariffs of many alternative providers are again significantly cheaper than those of the local basic suppliers.
According to the Check24 portal, the tariffs of alternative energy suppliers are lower in February than they have been since the end of 2021 and thus not before the outbreak of the Ukraine war: the average electricity price is currently 40.4 cents per kilowatt hour. A four-person household with a consumption of 5000 kilowatt hours per year pays an average of 2114 euros for the basic supplier. The alternative supplier charges an average of only 1871 euros, which is 243 euros less.
“For electricity, there are more and more new customer tariffs below 40 cents per kilowatt hour, which are cheaper than comparable tariffs including the electricity price brake,” says Steffen Suttner, Energy Manager at Check24.
Consumers could also save on gas: the average gas price is currently 13.1 cents per kilowatt hour. The Check24 data shows that the difference between the basic supplier and the alternative supplier is around 290 euros. A family of four with a consumption of 20,000 kilowatt hours of gas pays an average of 2732 euros per year for the basic supply, while the ten cheapest providers on the market charge an average of only 2441 euros. In both cases, the gas price brake was taken into account.
Short duration is better
So should consumers now actually switch electricity or gas providers – or does this also entail risks? Comparison portals such as Check24 receive a commission for each transaction, which is why they naturally recommend switching. But the consumer centers also recommend comparing your own tariff with the offers of the comparison portals. Because “something is happening on the energy market right now,” says Sabine Lund from the Energy Market Observation team.
Last year, basic suppliers were consistently cheaper than the providers with the cheapest tariffs on the market. In the meantime, that has changed in big cities, says Lund. In January, around half of the alternative providers were cheaper than the basic providers. Since February, no basic supplier has been cheaper than an alternative provider.
While basic suppliers buy in the long term, other providers on the spot market order in the short term. In the past, they were often able to offer their customers low prices. However, they were unable to cushion the extreme increase in prices as a result of the Ukraine war, so the default suppliers guaranteed stable prices with their procurement strategy last year.
“Prices can still fluctuate greatly over the next few months and become cheaper,” says Lund. “Consumers should think short-term.”
You have to keep that in mind when changing
Consumers should take a few things into account when switching electricity and gas providers: if their own tariff is below the prices of the comparison portals, it is rather cheap. If the tariff is higher than the other offers, it is rather expensive and a change could be worthwhile. However, the consumer advice center points out that the prices displayed on comparison portals can sometimes be out of date and they often do not show basic service tariffs. The basic suppliers are usually the local municipal utilities, where you can find the relevant tariff information.
If a new tariff is cheaper than the existing one, it is advisable to pay attention to the customer recommendation rate and the term of the new contract. Short terms of several months up to a year offer flexibility, even if the price conditions for new offers may then be worse. “Long-term contracts with a contract period of more than a year are not recommended,” says consumer expert Lund.
Whether a price guarantee is worthwhile is difficult to predict, especially in changeable times like these. If the tariff offered with a guarantee is at an acceptable price level, it makes sense to choose it. However, the scope of the guarantee should be taken into account. If, for example, taxes or surcharges are excluded, the provider can still increase the price. According to the consumer advice center, the federal government’s price brake is currently ensuring stable prices anyway. In this respect, consumers can also choose a tariff without a price guarantee and, if in doubt, switch again. In the event of a price increase, consumers always have a special right of termination.
The article first appeared at Capital.de