Energy Costs for Private Households Drop in the First Quarter of 2023
After eight consecutive quarters of rising energy costs, private households are finally seeing some relief in the first quarter of 2023. According to a recent analysis by comparison portal Verivox, the annualized expenditure for heating, electricity, and fuel dropped by an average of 18 percent from January to March. This is the first time energy costs have fallen in two years.
The significant decline in energy costs can be attributed to falling prices on the raw materials markets, as well as the government energy price brakes. Verivox noted that the decrease in energy prices helped alleviate some “fear” on the markets, which led to many energy suppliers lowering their prices.
A model household used by Verivox has an annual heating requirement of 20,000 kilowatt hours, an electricity consumption of 4,000 kilowatt hours, and an annual mileage of 13,300 kilometers. From October to December 2022, energy costs for this household were an extrapolated €7,163 per year. However, in the first three months of 2023, the same amount of energy cost €5,889 per year.
Verivox also considered that in Germany, more heating systems are heated with gas than with oil when calculating heating costs. Despite the decreased energy costs, Verivox noted that households would have also benefited from state price brakes. Without these price brakes, energy costs for a model household in the first quarter of 2023 would be €6,604 per year, which is still 8% below the costs from the last quarter of 2022.
Verivox energy expert Thorsten Storck emphasized that the receding fear of supply bottlenecks and continuous falls in wholesale energy prices have been contributing factors to the decreased energy costs.