February 1, 2023

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The return of "normal" energy contracts expected in the spring

The return of “normal” energy contracts expected in the spring

NOS

NOS News

  • Robert Koster

    Economy reporter

  • Robert Koster

    Economy reporter

Lower purchase prices for gas and electricity and new rules for ending energy contracts are good news for households. Not only are the costs of variable energy contracts lower, there is also room for long-term fixed-price contracts.

So it appears that the household energy contract market is entering calmer waters this spring. Long-term contracts are expected to be offered again from April.

However, the energy majors have not yet made any concrete promises about what kind of contracts and the prices they correspond to, according to a roundup of the Big Three energy companies. They promise there will be permanent contracts again, but the moment and the details of that are still being worked out.

The terms of the permanent power contract are getting stricter. The energy company must guarantee the price and the consumer must actually complete the contract or pay a higher penalty.

New rules for fixed energy contracts

The Dutch Authority for Consumers and Markets (ACM) has set new rules for this that are similar to those for mortgages. You can cancel a permanent contract, but the power company will then charge for the loss you suffer.

The purchase price of electricity is now falling sharply:

The government is asking for fixed energy contracts

Energy companies are under great pressure from the government to offer permanent contracts again. Climate and Energy Minister Cetin is preparing legislation that would force companies to offer permanent contracts for at least one year. This is important because the Cabinet wants to stop subsidizing energy bills via the price cap at the end of this year.

Finance Minister Kaag has indicated several times that the price cap will not be extended beyond this year, although the energy crisis will likely not be over by then.

The purchase price of gas has also fallen sharply:

Uncertainty about gas prices is not over yet

Gasoni and most energy experts assume that the gas supply uncertainty will continue for several winters. Thus, the current decline in prices in the gas market does not provide any guarantees for the future. So without government help, just a long-term contract that gives households some certainty about their energy bill.

AP

Arrival of a floating gas station in Imshaven, September 2022

Uncertainty about rising energy prices

There is mistrust about the high rates charged by energy companies in the Netherlands. When it became clear that there would be a price cap, purchase prices for gas and electricity had already fallen sharply. However, variable rates rose sharply again on January 1.

The free energy market is under pressure

Outside Research On behalf of Energiebeheer Nederland, it turned out yesterday that 57% of the Dutch now believe that the energy supply should be entirely in the hands of the government.

The free energy market can no longer be taken for granted politically either. At the request of the House of Representatives, Minister Cetin is conducting an analysis of market forces that has been carried out and expected before the summer.

Price comparisons are optimistic

Meanwhile, price comparison sites in the Netherlands are optimistic: they expect there will be something to choose from again this spring for consumers. This morning it also emerged that for the first time an energy company is using that pricing again Stay under the price cap.

Other energy companies are expected to follow this example. This means that the price of gas and electricity will also fall for households for the first time in a long time.

Because there might be something to choose from again, energy companies don’t want to make the competition any wiser about the types of contracts they’ll offer and the prices associated with them.