Household Energy Price Index for Europe
February 5th 2015
January Prices Just Released
The most up-to-date picture of European
household electricity and gas prices: VaasaETT
and two leading European energy market
authorities collaborate to track monthly energy
prices in 23 European countries
In This Month’s Edition
European energy price development
There have been numerous changes in energy prices
this month compared to last. Remarkably however,
changes
in
electricity
prices
seem
to
have
compensated each other since the value of the
electricity index remained unchanged. The gas price
index on the other hand decreased by 1 index point
in January compared to December (Figures 1 and 2.)
Residential electricity prices
Figure 3 shows the end-user price of electricity in 23
European capital cities as of January 1st 2015. It
shows that depending on where a customer lives in
the EU, the price that customer has to pay per kWh
of electricity can vary by as much as 142%. If we
include Belgrade, the price varies by a staggering
ratio of 5.2. Household customers in Copenhagen
and (since January 2013) Berlin pay by far the
highest prices in Europe (though the price of energy
1
HEPI price trend –
electricity prices excluding
taxes stable, gas prices
keep decreasing
Numerous significant
changes in energy prices in
Europe as distribution
prices and taxes are
revised;
Energy Price breakdown –
Market forces represent
less than half of the
electricity bill.
represents only a small portion of the total price, the lion’s share being taxes, in
fact), while inhabitants of Belgrade pay the least followed by inhabitants of
Budapest.
As mentioned earlier, various price components were changed in numerous
countries (as is traditionally the case in January). The most significant changes
were:

Price increase in Lisbon (+3.9%), Madrid (+5.4%), Paris (+2.4% due an
increase in energy taxes), Vienna (+3.9%), Prague (+6.9% in local currency)
and Bucharest (+5.7% in local currency);

Price decrease in Brussels (-5.1%), Bratislava (-3.9%) and Rome (-2.2%);

Other interesting changes took place in Luxembourg where both the PSO and
the VAT rate increased but were offset by a decrease in the distribution
prices;

Finally in Finland, the electricity tax increase (+18%) was almost offset by a
decrease in the distribution price.
When adjusted to purchasing power in each country1, most CEE countries end up
with prices which are above the European average (Figure 4). Lisbon overtakes
Copenhagen as the place with the most expensive electricity followed by Prague
and Berlin. On the other end of the spectrum, Helsinki has the cheapest electricity
at PPS followed by Stockholm and Belgrade.
Residential gas prices
Figure 5 shows the end-user price of natural gas in 22 European capital cities as of
January 20152. The highest price by very far is paid by inhabitants of Stockholm
(nearly twice as much as the second most expensive city for gas). This can be
1
PPS is an artificial common reference currency unit that eliminates price level differences between countries.
One PPS thus buys the same given volume of goods and services in all countries. It is developed by Eurostat to
accurately compare prices across Europe.
2
Please note that Helsinki has been left out of this analysis on gas prices. Indeed, there is virtually no residential
gas market in Finland.
2
explained by the small size the market; there are only 33,000 household gas
customers in the whole of Sweden3. Not accounting for Stockholm, Copenhagen
becomes the most expensive city for gas where prices are 3.2 times as high as in
Bucharest, the cheapest city for gas.
The most significant changes this month were:

Price increase in Stockholm (+11% in local currency), Ljubljana (+3%),
Prague (+3.3% in local currency)

Price decrease in Amsterdam (-2.1%), Brussels (-5.4%), Copenhagen (9.2% in local currency), Luxembourg (-2.7%), Madrid (-3.2%).
Prices at PPS (and ignoring Stockholm) offer a very different outcome. Lisbon
(where the municipal tax charged has more than doubled this July) has the highest
adjusted prices followed by Belgrade, Ljubljana and, while Luxembourg, Brussels
and London have Europe’s lowest adjusted prices for gas (Figure 6).
Energy price breakdown
The breakdown of end-user energy prices
into four components
(energy,
distribution, energy taxes and VAT) also shows major variations. (See Figures 7 and
8.) Our survey shows that on average, the energy price component (including retail
margins) represents about 38% of the end-user price of electricity, distribution
35%, energy taxes 11% and VAT 16%, while energy (including retail margins)
represents 52% of the end-user price of natural gas, distribution 24%, energy
taxes 8% and VAT 16%. Copenhagen is a very unusual case; the cost of energy as
a commodity represents less than a fifth of the end-user electricity price, by far the
lowest of all surveyed cities, whereas the energy taxes represent an astonishing
31% (over three times Europe’s average) and 51% if we include VAT. A similar
(albeit to a lesser extend) case is Berlin where since the introduction of the
Energiewende, the energy tax component represents 29% of the end-user price of
electricity.
3
The Swedish electricity and natural gas markets 2011 (2012: 61).
3
Overall, the results show that market forces represent only about half of the enduser price (both for electricity and gas) whereas national fiscal and regulatory
elements are responsible for the other half through distribution tariffs, energy taxes
and VAT.
4
Figure 1. Evolution of residential energy and distribution prices excluding taxes in the EU-15
Figure 2. Evolution of residential energy and distribution prices excluding taxes in the EU-22
5
Figure 3. Residential electricity prices including taxes (January 2015)
35
30.86
30
Change / previous month
29.80
Red: price increase
Green: price decrease
Black: no price change
*: Price change due to exchange rates
23.80 23.75 23.40
25
c€ per kWh
20.63 20.44
20
19.60 19.25
18.87
18.24
18.22 18.02
16.69 16.33 16.21
15
15.37 14.87 14.76
13.89 13.32 13.30
12.18
10
5.97
5
Source: HEPI by Energie-Control Austria, MEKH and VaasaETT Ltd.
© 2015 VaasaETT Ltd.
0
End-user electricity price (January 2015)
Figure 4. Residential electricity prices including taxes at PPS (January 2015)
30
25
c€ per kWh
20
15
10
5
30.46
28.38 28.35
26.78 25.98 25.98
22.6 21.94 21.73 21.6
21.19
19.13 19.08 19.08 18.46
20.42
17.86 17.44
Source: HEPI by Energie-Control Austria, MEKH and VaasaETT Ltd.
© 2015 VaasaETT Ltd.
0
End-user electricity price at PPS (January 2015)
6
16 15.57
14.76
13.04 12.89
11.26
Figure 5. Residential gas prices including taxes (January 2015)
20.92
Change / previous month
20
Red: price increase
Green: price decrease
Black: no price change
*: Price change due to exchange rates
c€ per kWh
15
10.21 10.04
10
8.53
7.77 7.43
7.26 7.18 7.15 7.05 7.05
6.81 6.66
7.20
6.08 5.73 5.71
5.34 5.29 5.16
5
4.60
3.36 3.15
Source: HEPI by Energie-Control Austria, MEKH and VaasaETT Ltd.
© 2015 VaasaETT Ltd.
0
End-user natural gas price (January 2015)
Figure 6. Residential gas prices including taxes at PPS (January 2015)
16
14
c€ per kWh
12
10
8
6
16.63
12.87
10.06
4
2
9.02 9.01 8.89 8.46 8.43 8.41
8.24 7.86
7.48 6.95
6.71
Source: HEPI by Energie-Control Austria, MEKH and VaasaETT Ltd.
© 2015 VaasaETT Ltd.
8.01
6.4
6.34 6.33 6.21 6.05
5.68
0
End-user gas price at PPS (January 2015)
7
5.4
4.73
Figure 7. Residential electricity price breakdown (January 2015)
100%
90%
20%
16%
12%
6%
80%
5%
70%
60%
23% 26%
15%
40%
6%
11%
16%
17% 7% 15%
20% 18% 19% 17% 19% 19% 20% 21% 17%
8%
16%
0%
1%
3%
11%
3%
13%
11%
10%
20%
16%
22% 20%
7%
49%
34%
38%
33%
39%
30%
50%
33%
32%
50%
36%
38%
27%
23%
40%
24%
28%
41% 47%
35%
43%
59%
44%
58%
57%
29%
47%
45%
20%
10%
4%
29% 25%
50%
30%
5%
9%
18% 17% 17% 11% 17%
4%
32%
27%
34%
37%
37%
32%
38% 32%
33% 35% 45%
33%
37%
40%
28%
35% 38%
Source: HEPI by Energie-Control Austria, MEKH and VaasaETT Ltd.
© 2015 VaasaETT Ltd.
13%
0%
Energy
Distribution
Energy Taxes
VAT
Figure 8. Residential gas price breakdown (January 2015)
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
5%
7%
9%
16% 17% 17% 18% 11% 14% 16% 12% 17% 6% 17% 2% 17% 17%
20% 20% 17%
20% 19% 5% 21% 19% 16%
5%
9% 6%
0%
3%
8%
5% 22%
9%
9%
12%
13%
23%
20%
19%
16%
16% 23%
26%
21%
21% 28%
31%
30%
25%
31%
24%
32%
23%
25% 38% 27%
37%
24%
11%
34%
69%
86%
64%
66%
22%
58%
64%
53%
59%
59%
52%
52%
52% 52%
47% 48%
47%
46%
46%
41%
37% 40%
30% 27%
Source: HEPI by Energie-Control Austria, MEKH and VaasaETT Ltd.
© 2015 VaasaETT Ltd.
0%
Energy
Distribution
Energy Taxes
VAT
Visit our project webpage at www.energypriceindex.com and subscribe to
the free monthly update of the HEPI index for Europe.
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For More Information
Christophe Dromacque
HEPI Project Manager
Office: +358 (0)9 4159 0344
Mobile: +358 (0) 44 906 6822
Email: [email protected] (English / French)
Anna Bogacka
Analyst
Office: +358 (0)9 4159 0344
Mobile: +358 (0) 44 906 6823
Email: [email protected] (English / Russian)
Silke Ebnet
Regulation and Competition
Office: +43 (1) 24724 715
Email: [email protected] (English / German)
László Szabó
Head of Unit
Department of Market Monitoring
Email: [email protected] (English / Hungarian)
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About the Authors
Energie-Control Austria
Energie-Control Austria was set up by the legislator on the basis of the new Energy
Liberalisation Act and commenced operation on 1 March 2001. Energie-Control is
headed by Mr. Walter Boltz and Mr. Martin Graf as managing directors and is
entrusted with monitoring, supporting and, where necessary, regulating the
implementation of the liberalisation of the Austrian electricity and natural gas
markets. More at: www.e-control.at
The Hungarian Energy and Public Utility Regulatory Authority
The main responsibilities of the Hungarian Energy and Public Utility Regulatory
Authority are consumer protection, providing regulated access to networks and
systems, carrying out regulatory competencies in order to maintain security of
supply and fostering competition. The scope of the infrastructures, which have to
be overseen by the Hungarian Energy and Public Utility Regulatory Authority has
been extended in 2011 with the complete regulation of district heating and in 2012
with the water public utilities. As market progresses are becoming more
widespread, we put emphasis on our market monitoring task and we pay specific
attention to regional market integration both in electricity and natural gas. More
at: www.mekh.hu
VaasaETT Global Energy Think Tank
VaasaETT is a research and advisory consultancy dedicated to customer related
issues in the energy industry. VaasaETT advises its clients based on empirical
evidence brought about from extensive research in the area of customer behavior
and competitive market behavior (including smart energy offerings, demand
response, energy efficiency, smart home, smart grid). VaasaETT’s unique
collaborative approach enables it to draw on an extensive network of several
thousand energy practitioners around the world who can contribute to its research
activities or take part in industry events it organizes allowing VaasaETT to integrate
global knowledge and global best practice into its areas of expertise. VaasaETT’s
truly global focus is reflected by research and strategic support having been
provided to a diverse array of organizations on 5 continents including for instance
28 of the Fortune Global 500 companies, the European Commission, Government
and public research bodies in Europe, Japan, the UAE, the Middle East and
Australia. More at: www.vaasaett.com
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