ᐅ Should we stick with the standard supply or lock in a fixed price for the winter period?

Hi everyone,

I need your opinion on the following topic:

Our contract with GAS.de was terminated earlier this year, and we were switched to ENBW's temporary supply tariff for about 30 days. We have now been on ENBW’s standard supply tariff (basic rate) in Stuttgart for several months.

I have been comparing prices for months, and strangely, this standard supply tariff with a 14-day cancellation notice is still the cheapest:

Monthly basic fee: €9 (about $9.50)
Price per kWh: €0.11 (about 11 cents)

Of course, ENBW can cancel the contract daily and raise prices, which in my opinion leads to several options:

1.) Stay put and only switch if ENBW becomes more expensive.
2.) Switch now and accept paying double the basic fee and price per kWh.

I realize this is a bit of a guess, but option 1 still seems the smartest to me because until winter, I barely need any gas except for water heating. Also, it doesn’t really make sense to sign a contract now that locks me in for a year, especially if gas prices might not skyrocket after all.

There is also the risk with option 2 that the provider might go out of business and I never get reimbursed for any overpayment since I’m paying an advance based on estimated annual consumption. Or would it be smarter in option 2 to declare a much lower consumption and then pay the difference later? Because the fixed price also applies to these additional payments, right?

Do you understand what I mean? I’m having a bit of trouble expressing this clearly…

Stay there. I expect that contract prices will only play a minor role this winter anyway. Starting in October, there is already a surcharge of 2-5 cents, and it is quite likely that the fixed price agreements will be lifted due to shortages. Therefore, a contract commitment will probably be of little use to you.

PS: To the best of my knowledge, incorrectly reported meter readings are punishable by law.

I would also initially do nothing. If it collapses, the new price guarantee probably won't help you much either…

The situation is as follows.

It must be assumed that all contracts will be terminated based on Section 313 of the Building Code (Baugesetzbuch), probably by October 1, 2022. The amendment to the Energy Security Act explicitly allows this.

Most gas customers are currently paying between 5 and 8 cents per kWh of gas. The first wave of price adjustments took place last week, effective from September 1, 2022.

As can be read, new gas prices will be between 25 and 28 cents per kWh. For example, on platforms like Check 24, this is the price range for new contracts, if any are still offered.

Anyone who still obtains gas at low prices should prepare for a 500 percent increase in gas prices starting in early October.

From October 1, the new gas price will be subject to an additional gas surcharge between 1.5 and 5 cents plus value-added tax.

So, in the worst case, the gas price could reach around 32 cents per kWh.

And because things are “going so well,” as of January 1, 2023, the introduced CO² tax will also be added on top. I do not know how much that will add to gas prices.

Since Germany operates more than 600 gas power plants, electricity prices are also expected to rise shortly.

But as Mr. Habeck said, more than 50 percent of the population will not earn enough to pay their bills anymore.

With that, good luck.

I thought you were only allowed to stay on the basic supply for three months? We also have an expensive tariff with a major provider and pay 16 cents. I went directly for 24 months because at that time it was still somewhat cheaper.

You can stay indefinitely in the basic supply. That’s what it’s there for. The local utility is obligated to provide service, so they essentially have a duty to supply customers. The same applies to electricity.

The question is at what price.

Since currently the basic supply tariffs are the cheapest, you can try to get into that. And basic suppliers will probably be the last to raise prices, because they have many socially disadvantaged customers under contract.

Unfortunately, it seems that about 90 percent of the population still don’t fully understand what is coming. Right now, most are more focused on vacation and believe that the current gas price will only add a surcharge of 1.5 cents and that will be it.

With the bailout of Uniper, Pandora’s box was opened. Gas suppliers can now pass very high market prices on to end customers—even with long-term supply contracts. Those contracts are now essentially worthless.