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ACM’s Monitor on the consumer energy market: More and more households start to feel the effects of the higher energy prices, as heat tariffs in 2027 will go up, too

Summary

  • Over the past month, the natural-gas price on the wholesale market has gone up further to 86 euros/MWh, which is the highest since December 2022.
  • More and more households start to feel the effects of the higher energy prices in their pockets.
  • Since the maximum tariffs for heat (or district heating) have been linked to the natural-gas price, households that have connections to a heat network (or district heating network), too, will see the effects of the higher prices from 1 January 2027.

More and more households start to feel the effects of the higher energy prices in their pockets. The Monitor on the consumer energy market of the Netherlands Authority for Consumers and Markets (ACM) has revealed that approximately 3.7 million households have a dynamic or variable contract for their supply of natural gas and electricity. These households are now seeing the effects of the higher prices on their monthly bills. Households with fixed contracts will see the effects of the higher prices when their current contracts expire. Since the maximum tariffs for heat (or district heating) have been linked to the natural-gas price, households that have connections to a heat network (or district heating network), which is approximately 700,000 households, will see the effects of the higher prices from 1 January 2027.

Over the past month, the natural-gas price on the wholesale market has gone up further to 86 euros/MWh, which is the highest since December 2022. In addition, natural-gas prices continue to be very volatile: in the past month, it happened several times that the price went up or down approximately 5 percent within a single day, usually as a result of news surrounding the conflict with Iran.

High natural-gas price has an effect on the 2027 heat tariffs

Households that are connected to heat networks are not able to choose which supplier they obtain their heat from. That is why, every year in December, ACM sets the maximum heat tariffs. All suppliers cannot set their prices higher than these maximum tariffs. These maximum tariffs have been based on the ‘no-more-than-otherwise principle’ (in Dutch: niet-meer-dan-anders principe): a household connected to a heat network cannot, on average, pay more than what a similar household using natural gas for heating pays. The law stipulates that ACM must calculate the 2027 maximum heat tariffs on the basis of the average price for fixed contracts for the supply of natural gas starting January 1, 2027. ACM uses three reference dates for this: 23 September, 23 October and 23 November 2026. On the basis of the first reference date, ACM sees that an average household with a consumption of 25GJ per year will pay approximately 25 percent more for the supply of heat next year. The increase is smaller for lower usage, and greater for higher usage. If the natural-gas price goes up further, the increase will be even greater than 25 percent.

ACM calls on heat suppliers to raise the tariffs only if this is really necessary, because of their costs. Heat suppliers that use gas-fired heat sources are directly hit by the high natural-gas price, and are thus likely forced to raise their tariffs. Suppliers that do not use natural gas for their heat production are likely to incur fewer extra costs, and are able to keep their tariffs lower. ACM sees to it that heat suppliers do not abuse the high maximum tariffs to generate more profits. That is why ACM will conduct another extensive investigation next year into the financial returns among all heat suppliers.

Rising tariffs for natural gas and electricity

Over the past month, the tariffs for fixed contracts for natural gas on offer have gone up almost 5 percent, while the tariffs for variable contracts for natural gas have gone up approximately 1.5 percent. As such, the natural-gas tariffs have reached new record highs this month since the 2023 energy crisis. The tariffs for electricity contracts on offer, too, have gone up significantly this past month: 5 to 8 percent, depending on contract lengths.

In line with the previous months, the number of households with fixed contracts continues to drop. When a fixed contract expires, that consumer automatically gets a variable contract. As a result thereof, the number of variable contracts has increased further. The number of households with dynamic contracts continues to grow.

High natural-gas price does not result in a significant reduction in consumption
So far, the steep increase in the natural-gas price seems to have a limited effect on natural-gas consumption. Since July 1, total natural-gas consumption is approximately 5 percent lower than in the same period last year, whereas the natural-gas price on the wholesale market is currently more than twice as high as last year. Since July, small-scale users in particular consume slightly less natural gas than last year. With regard to large-scale users, no significant deviation from the trend has been observed. The limited decrease likely has multiple causes. A major factor for many households is the relatively high temperatures compared with last year, and, by extension, the reduction in demand for heating so far. In addition, it is also possible that natural-gas users respond to price increases to a limited extent, or that they do not yet feel the higher natural-gas price because of fixed contracts.

Significantly higher tariffs

ACM keeps a close watch on the prices of energy suppliers. As part of this oversight, ACM looks at, among other aspects, price differences between suppliers as well as the reasons for these differences. ACM’s Monitor on the consumer energy market reveals that the prices of certain contracts for households this month are significantly higher than comparable contracts from other suppliers.

 

Supplier Type of contract
Groenpand Natural gas 1 year fixed

ACM’s Monitor on the consumer energy market also reveals that several suppliers charge significantly higher prices for their model contracts. This is the case for Groenpand, Zonneplan, Tibber, EP Commodities, VrijOpNaam, and ANWB. A model contract is a standard contract that every energy supplier is statutorily required to offer, including suppliers that wish to offer only dynamic contracts. The fact that prices of these model contracts are significantly higher says nothing about the prices of other contracts offered by these suppliers.

See also