Experts warn of the risk of high prices for customers

Explained briefly

Experts warn: These electricity tariffs are very risky

Since January 1, consumers have a choice of different electricity pricing models. But what is the difference between fixed, dynamic and variable electricity prices?

Consumers don’t just save money by switching electricity providers. Using special electricity rates can also help ensure your bills are lower at the end of the year. This is made possible by electricity with fixed, dynamic or variable prices. What does it mean? And which model is suitable for whom?

From January 1 2025, electricity providers must offer their customers not only electricity at a fixed price, but also tariffs where electricity prices are dynamic. Dynamic means the price per kilowatt hour that customers pay is based on the current stock market price – plus a fixed floor price.

Stock market prices are influenced, among other things, by factors such as supply, demand and supply of renewable energy. Consumers can usually see prices through the provider’s application or website and adjust their electricity consumption accordingly.

For consumers who are very flexible and well-organized, these tariffs can help reduce electricity bills. For others, switching can incur additional costs. Because price fluctuations are very high. This means that the price risk lies entirely with the electricity customer.

Another problem is complexity. Electricity customers must always monitor exchange prices and they must also align their consumption with developments in electricity prices to save as much money as possible.

Additionally, it is difficult to compare contracts with dynamic electricity rates. Ultimately, there is no fixed price for a kilowatt hour as a guide.

Anyone who can flexibly shape their consumption habits, is well organized and likes to follow developments in electricity exchange prices can save with the new tariffs. However, users must remember that the development of electricity prices in general is still uncertain and could skyrocket significantly as a result of a further crisis.

With variable electricity tariffs, price adjustments occur less frequently than with dynamic tariffs. For time variable models, such as day and night electricity, the price is set in advance. Variable load tariffs adjust prices to network load, which is primarily controlled by the network operator. The risk for consumers is therefore lower, as they can, for example, reorganize laundry, charge an electric car or buffer storage.

However, with varying rates, there is also the issue of comparison between individual service providers. And efforts to monitor price developments periodically and adjust consumption planning must also be considered when choosing this electricity tariff.

It depends on your personal consumption behavior, which tariff can save you the most. If you want to be safe and not have to deal with electricity prices on the electricity exchange every day or even every hour, it is better to stick with fixed price tariffs.