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Electricity price : Why is the price of electricity rising all the time?

While a family of four with an annual consumption of 4,000 kWh paid an average of 708 euros a year in January 2004, according to research by the Internet comparison portal Verivox it was already 1120 euros in May 2013. This corresponds to an increase of 412 euros, or 58 percent. The numbers get even more blatant if you go back further. If you compare today's average electricity price with that of 1998, consumers even have to pay 67 percent more for their electricity bills, according to the German Association of Energy and Water Management (BDEW) for a three-person household with an annual consumption of 3500 kWh.

Instead of 49.90 euros, 83.80 euros per month would be due today, reports the association. The German Tenants' Association is sounding the alarm. Tenants now have to pay a third of their net household income for rent and energy alone, warn the tenant protectionists. In metropolitan areas, even half of the income could be spent on living, heating and electricity. What is annoying for many people can become an existential problem for the socially disadvantaged. Every year the utilities turn off the electricity for 600,000 to 800,000 people because they are not paying their bills.

How the state gets in on the price of electricity

Until 2009 it was the rising costs of electricity procurement, today the state is the biggest price driver for electricity costs. State charges and taxes account for a good 70 percent of the electricity price. Only 30 percent of the costs are attributable to energy generation and sales - i.e. the items that the electricity provider can influence. However, there are big differences between the various tariffs. That's because of the competition: There are currently more than 1,000 electricity suppliers on the German market. They all attract new customers - often with an extremely low electricity price in the entry-level tariffs.

However, consumer advocates warn against choosing the cheapest offer at any price. Customers should keep their hands off tariffs with prepayment, deposits or electricity packages, where a certain amount of electricity is purchased, advises Holger Krawinkel, an energy expert at the Federal Association of Consumer Organizations (VZBV). Hundreds of thousands of customers have had to experience firsthand how expensive supposedly cheap tariffs can be. Many consumers are still running after their money, which they paid the bankruptcy providers Teldafax or Flexstrom in advance for electricity that they never received after the bankruptcy.

Why the electricity price will continue to rise in the future

The price of electricity is rising steadily. The EEG surcharge, which is used to promote the production of green electricity, was increased by 18 percent on January 1, 2014 to 6.240 cents per kilowatt hour. At the beginning of 2013 the surcharge had already risen by 1.7 cents to 5.28 cents. Forecasts by the ├ľko-Institut assume that the EEG surcharge will continue to rise until 2022.

The network fees that electricity suppliers pay to the respective network operator are also constantly increasing - and will continue to do so in the future. Because the lines have to be expanded for the energy transition, these costs will continue to rise.

Save by changing

If you want to avoid the high prices, you only have one choice - you have to switch to a cheap electricity tariff. The Federal Network Agency also recommends this to everyone who still purchases electricity from their basic supplier at the old conditions. Even switching to a cheaper tariff with the traditional supplier can bring enormous savings. You can save even more if you go to a more attractive supplier. Even if you ignore discount rates with prepayment and package rates, a four-person household with an annual consumption of 4000 kWh can save several hundred euros a year, Verivox has calculated.

How high the savings are also depends on where you live. While in Stuttgart, which has a comparatively expensive basic service tariff, a good 360 euros can be saved a year, in Berlin it is 320 euros, in Hamburg it is only 290 euros. But that is not to be despised either. "Household customers can achieve lower prices by changing their contract or supplier," advises the President of the Federal Network Agency, Jochen Homann. But this message has still not reached many customers. Homann criticizes 40 percent of all household customers still in the basic supply, the most expensive of all tariffs.

If you are thinking about a general change of electricity provider and want to save money in the long term, you can find out more using the following electricity calculator.

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