Energy prices for households fell for the second time in a row in December. The Energy Price Index (EPI) calculated by the Energy Agency fell by 10.9 percent compared to November, the largest monthly drop since measurements began in 2000. The reason for this is lower prices for fuel, domestic heating oil and electricity. In a year-on-year comparison, however, prices were 26.7 percent higher and therefore still at an extremely high level.
One reason for the price drop is the entry into force of the electricity cost brake. As a result, the electricity price (net working price) for all households up to a consumption of 2,900 kilowatt hours (kWh) is automatically capped at 10 cents per kWh; the difference is subsidized by the government. Electricity prices for households fell by 21.2 percent compared to November 2022, and prices were also 7.5 percent lower year-on-year.
“Effect of the electricity cost brake partly skipped”
“However, existing price guarantees expired in December 2022 and some energy suppliers have already implemented price increases for January as part of their regular price adjustments. In addition, the new, significantly increased grid loss tariffs have come into effect. All in all, the effect of the electricity cost brake will be imposed, at least in the short term,” said Franz Angerer, director of the Austrian energy agency.
Gas prices for households fell by 2.4 percent on a monthly basis, but fuel prices rose by 92.7 percent on an annual basis. District heating was the only energy source with rising prices in December: compared to November, the price increased by 6.6 percent and year-on-year by 72.2 percent. According to the Energy Agency, the long-term price increase for district heating has been moderate compared to other energy sources for heating. At the same time, general statements about the price are only representative to a limited extent, as the price largely depends on the fuel used (eg biomass, natural gas or waste). Wood pellets and firewood also cost less in monthly comparison (respectively minus 6.3 and minus 0.6 percent), but calculated over the year there were also considerable price increases here (plus 124.4 and minus 79.7 percent respectively).
Fuel prices have also fallen
Fuel also cost less in December than in November, but refueling was still a lot more expensive year-on-year. For example, prices for premium petrol fell sharply by 11.3 percent in a monthly comparison, but a tank filling of 50 liters costs about 75 euros, which is still 7.6 percent more than a year ago. A similar picture emerged for diesel: here the price was 12.4 percent lower than in November, but a typical tank filling was still around 15 euros more expensive in a year-on-year comparison. Diesel cost about 20 cents per liter more than premium petrol in December. The price of domestic heating oil fell 13.7 percent month-on-month, but rose 60.6 percent year-on-year.
However, fuel prices rose again in January. “A look at the wholesale markets also shows that the fall in fuel prices in December is unsustainable,” says the energy agency.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
