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INTERVIEW: How can consumers in Germany shield themselves from high energy prices?

The war in Ukraine is likely to worsen the already dramatic situation on energy markets. We asked a German expert how consumers can make smart choices to ensure that their utility costs stay under control.

Published: 25 February 2022 11:17 CET
INTERVIEW: How can consumers in Germany shield themselves from high energy prices?
A gas cooker. Experts advise people to use their gas and electricity efficiently. Photo: dpa | Marijan Murat

With prices rising across the board, people in Germany are getting less bang for their buck now than in previous years. This is particularly true of utility bills, which are being pushed up by the Ukraine crisis and string demand for natural gas in east Asia.

With utility companies struggling to deal with record prices on energy exchanges, some customers have been hit with the worst possible news this winter: they’ve had their contracts cancelled and have been pushed onto contracts with default suppliers.

READ ALSO: German government moves to end short-notice energy contract terminations

Given these unfortuitous circumstances, we thought it’d be useful to speak with Christina Wallraf, energy expert at the consumer rights centre in North Rhine-Westphalia.

Ms Wallraf, is it currently worth switching utility providers?

You should consider changing your electricity and gas providers at the moment if you have been informed of a significant increase in charges or if you have been pushed onto a contract with the default supplier.

Use price comparison websites to compare your current rate with the prices of alternative suppliers. In addition, keep the default supply tariff in mind. Default suppliers have to publish their prices on their website.

Customers who have not yet been given a price increase, or who have received only a moderate increase, will often be unable to find better offers on the market at the moment. They should stick with their current tariff.

What should one consider when looking for a new supplier?

Besides the price, it’s important to pay attention to the experience of other customers. Try to make sure that you find a provider that is as customer-friendly as possible.

The length of contract is also important. We recommend that you commit to a maximum of one year so that you can react flexibly to market changes.

The German government is planning to abolish its renewable energy surcharge in the summer or at the latest at the turn of the year. So you shouldn’t tie yourself down for too long. Or, choose a provider who will pass on the entire reduction in the surcharge to the consumer.

If you pick a tariff with a starter bonus, make sure to cancel it after one year, otherwise it will become very expensive.

How can our readers reduce their energy consumption wisely?

Identify electricity guzzlers in your home. These can be different in each household. Ask yourself: do I have a lot of home electronics, or older appliances like washing machines or refrigerators and freezers? If your water heating is electric, this also consumes a lot of electricity.

Be selective in using home entertainment systems. Big screens consume a lot of electricity. Devices on standby should be switched off completely, for example via a power strip.

Old appliances should be replaced, or at least used as energy-efficiently as possible: make sure your washer is full when you use it, use the ‘eco’ setting. Regulate you refrigerator to seven degrees Celsius. Each degree lower increases consumption by six percent.

In terms of water heating, don’t leave under-counter appliances on standby. It’s better to switch them off at night. Don’t set instantaneous water heaters to the highest level – you end up adding cold water at this level anyway because the water is too hot.

If you are a home owners, an old heating pump can also eat through electricity, so a new acquisition will pay off after a few years.

Save on heating bills energy by heating and ventilating your homes properly. Don’t adjust the setting on your radiators. One degree less in room temperature saves 6 percent on your heating bills. Only air out your home in quick bursts – avoid tilting the windows, otherwise the room will cool down and it increases the risk of you getting mold. 

Do you have any other smart tips for our readers?

If you are an home owner or landlord, you should invest in renewable energies. Heat pumps, photovoltaic systems, insulation – that’s the only way to reduce energy costs in the medium term.

READ MORE: How to change electricity and gas providers in Germany

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MONEY

EXPLAINED: How to change electricity and gas providers in Germany

With energy prices in Germany continuing to rise, we explain how you can try to get the best deal for your home by changing suppliers. 

Published: 24 February 2022 10:33 CET
Updated: 26 February 2022 08:29 CET
EXPLAINED: How to change electricity and gas providers in Germany

According to the Federal Ministry of Economics, the price of electricity in Germany is currently at a record high of 32.63 cents per kilowatt-hour, and gas prices are being driven ever higher by restricted supplies and the Russian invasion of Ukraine.

If you think you might be missing out on a better deal, here’s how you can secure the best tariff for your home by switching to another supplier. 

Easier than you think 

Some may be put off by the idea of changing energy suppliers due to concerns that the process will be complicated and that they may be left without energy while changing providers. But in Germany, there is a legally guaranteed basic supply, meaning you will be supplied by the so-called basic supplier in your area during any changeover period. (Don’t switch too close to the deadline though, as this can get expensive.) Also, technically speaking, a change of supplier does not change the electricity or gas for your household, meaning no one has to come to your home and the change is free of charge.

Contract termination

The time at which you can change your electricity or gas supplier depends on your current contract. Different notice periods apply depending on whether you are a customer of a basic supplier, an alternative supplier or have a special right of termination.

If you are a customer of a basic supplier and have never changed your provider, you can change your gas or electricity supplier at any time. In this case, you have two weeks’ notice before the contract with your new supplier can start.

If you are a customer of an alternative provider – which is the case with most people –  you are bound by certain deadlines and you will need to pay attention to the minimum contract period and the notice period in your contract.

READ ALSO: Moving house in Germany: 7 things you need to know about setting up utility contracts

Many contracts will run for a minimum of one year, after which they are automatically extended. In this case, it is very important to pay attention to the notice period in your contract, as, once the period expires, the contract will be extended by another year. You should therefore act in good time and can initiate the change of provider up to six months before the contract expires. The termination of the old contract is usually taken over by the new supplier, who then directly takes over the supply as soon as the old contract has expired.

In certain circumstances, a so-called special termination right can apply – meaning you can terminate your contract without having to observe the usual contract or notice periods. Moving house, for example, is a special situation for which this rule applies. Another is if your provider announces a price increase, in which case you have the option of exercising a special right of termination. In this case, the notice period is usually two weeks from the announcement In these cases, it is best to send the termination notice yourself, rather than getting your new provider to do so on your behalf. You can inform the new provider that you have cancelled your current contract yourself by adding a note to the order.

The new electricity or gas contract usually comes into effect as soon as the new supplier has sent you a contract confirmation with the expected start of delivery.

The previous provider then has up to six weeks after the end of delivery to issue a final invoice.

Search for other offers

There are numerous electricity price comparison sites that you can use to find out if you are paying too much for your energy: Check24 and Verifox are two of the biggest ones. 

The websites offer tariff calculators, which enable you to see what other suppliers offer for the same level of consumption in your area. To use these calculators, you should have your postcode and your annual electricity consumption at hand – which you can find in your last gas or electricity bill. 

READ ALSO: How Germany plans to help households cope with rising costs

When researching electricity and gas contracts, you should not only pay attention to the prices, but also carefully check the terms and conditions of the contracts on offer. The shorter the terms and periods of notice, the more flexible you are as a customer – meaning you can act quickly and without complications if you decide you need to change again.

Be careful with suppliers who offer favourable rates in return for an advance payment or a deposit as, if the company goes bankrupt, it is almost impossible to get the money back. Also, watch out for package prices: here, the price is linked to a certain amount of consumption and if you try to save electricity by using less energy, you don’t get your money back, but if you use more energy, you still have to pay more. 

Once you have found a suitable offer, check on the provider’s website whether the details match those in the price comparison calculator. If there are discrepancies, ask the provider directly.

Making the switch

Before changing to another provider, it’s worth contacting your current supplier and asking if they can make you a better offer. Before calling, have the details of any better tariffs you have found to hand so that you have a good basis for negotiation.

If you decide to go ahead and change supplier, you can either conclude the new contract directly with the new provider or, in some cases, via the tariff portal, though the portal usually charges a fee for this service. In any case, the new provider will terminate your previous contract on your behalf if you sign the power of attorney allowing them to do so.

READ ALSO: Electricity bills in Germany – how to keep your costs down

Useful Vocabulary:

electricity supplier – (der) Stromanbieter

basic (energy) supply – (die) Grundversorgung  

electricity price comparison – (der) Strompreisvergleich  

 tariff calculator – (der) Tarifrechner

contractual period – (die) Vertragsdauer

notice period – (die) Kündigungsfrist

special termination right – (das) Sonderkündigungsrecht 

power of attorney – (die) Vollmacht

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