It will be expensive for consumers
Eon terminates electricity customers
By Christina Lohner
09/15/2022, 5:47 p.m
Numerous electricity and gas customers are losing their contracts because energy suppliers are terminating them. Now even Eon is taking this step. New contracts cost consumers many times over. This also puts corporate customers in financial difficulties.
After numerous smaller electricity providers, Eon is now the first energy giant to give up customers. Contracts are not extended at the end of the term – the alternative offered is significantly more expensive. Public utilities and other suppliers are now also terminating contracts with business customers and are not even making them a new offer.
Termination at the end of the contract period is legally correct, as consumer advocate Matthias Moeschler, who runs the Verbraucherhilfe-stromlieferer.de portal, clarified in an interview with ntv.de. However, the employee who brokers electricity contracts on a part-time basis cannot understand Eon’s approach: “Why doesn’t the reputable, reticent company increase the prices instead of giving notice?”
According to Moeschler, an affected customer has so far only paid around 25 cents per kilowatt hour (kWh), with the alternative offer around 80 cents would be due. The consumer advocate would have found up to 40 cents in view of the massive increase in procurement costs. This price corresponds to offers from other providers.
Around 20 providers are giving notice before the end of the term
According to Moeschler, it has indications that, in addition to Eon, another major provider is terminating customers, in this case gas tariffs. According to him, around 20 providers even terminated contracts for electricity and gas before the end of the term – according to consumer advocates this is inadmissible. According to Moeschler, almost a million customers are affected, mostly with electricity contracts. A customer number of up to five digits received permissible terminations at the end of the contract. In addition, 13 providers have filed for bankruptcy.
In the case of Eon, according to Moeschler, there are only a few cases. The company itself does not comment on specific customer numbers, as a spokesman said when asked by ntv.de, but also speaks of a few cases. “The procurement prices for energy on the markets are at a historically high level – sometimes with strong fluctuations,” explains the spokesman. “We must also take this development into account in pricing and energy contracts.” Eon does not take the step lightly, but is forced to do so by the unique market situation. “Of course, we offer these customers the opportunity to conclude a new contract with us that corresponds to the current market conditions.”
Moeschler says that “customers cannot defend themselves against such permissible terminations”. The only thing left is to look for a new contract. There are currently electricity contracts with a price guarantee for around 40 cents per kWh. In the case of cancellations before the end of the term, Moeschler advises you to object, which is why he is on his portal sample letter offers. “As a rule, the providers do not go into it, after a reminder, those affected should then – for customers free of charge – Energy arbitration board switch on.” Due to the high number of complaints, it currently takes about six weeks before the arbitration procedure is opened.
Business customers have to close
Keeping the contract usually doesn’t work, reports the consumer advocate. In the event of termination before the end of the term, however, compensation is possible: the difference between the new prices and the prices actually agreed up to the end of the term. It is still disputed whether terminations are permissible if the term ends but a price guarantee was also agreed.
What puts some private consumers in financial difficulties also endangers companies. Municipal utilities terminate business customers at the end of the term – without a connection offer. In Osnabrück alone, more than 1,000 companies are affected, reports the “Wirtschaftswoche”, which first reported on Eon’s layoffs.
For some business customers, alternative offers cannot be accepted, for example if the new energy price is ten to twenty times the previous value. According to the report, the operator of several Edeka markets, for example, is considering branch closures. An ice rink in Ludwigshafen is also desperately looking for an alternative connection contract because, according to its own statements, the electricity costs would be 50,000 to 80,000 euros instead of the previous 10,000 euros. “This is not economically viable and would result in the club going bankrupt,” the website said.