ACM: the tariffs of the three largest energy suppliers are not unreasonable
An investigation conducted by the Netherlands Authority of Consumers and Markets (ACM) has shown that energy suppliers Eneco, Essent, and Vattenfall currently do not charge unreasonable tariffs. The profits earned from their current tariffs are not higher than those earned in previous years. In 2022, profits were between 0% and 5%. The high prices that consumers have to pay are the result of the high purchase prices that suppliers pay for natural gas and electricity. On top of these purchase prices, suppliers also need to spend more on insurance against risks on the turbulent energy market.
The investigation also shows that the suppliers buy natural gas and electricity at least one month in advance (and often much longer in advance) on the wholesale market. As a result, there is a lag between decreases in wholesale prices and decreases in energy prices for consumers. Purchase prices at the moment are going down, and the suppliers have therefore announced that they will lower their prices further in the coming months.
ACM has intensified its oversight over energy prices since the price cap was introduced. Over the next few months, ACM will continue its investigation by looking into the tariffs of other large energy suppliers. Furthermore, ACM will continue to keep a close watch on the prices for new customers through its monthly Monitor on the consumer energy market (in Dutch: Monitor Consumentenmarkt Energie).
Martijn Snoep, Chairman of the Board of ACM, adds: “I completely understand that people experience the current energy prices as unreasonable. People may suspect energy suppliers of making record profits. However, that is not the case. After subtracting all costs, their profits amount to no more than several tens of euros per household per year. The high prices are caused by high purchase prices on the turbulent energy market. If prices continue to drop on the wholesale market, the tariffs of the energy suppliers will surely reflect this soon, too. We will keep a close watch on those tariffs.”
ACM conducted an extensive investigation into the three largest energy suppliers in the Netherlands. As part of its investigation, ACM sent a team of experts to the head offices of Eneco, Essent, and Vattenfall for an on-site examination of the books and computer systems. In addition, ACM assessed confidential company documents regarding purchasing strategies and how tariffs are set. ACM is not authorized to assess the prices on the international wholesale market.
Update to the Monitor on the consumer energy market
From noon today, the Monitor on the consumer energy market shows the tariffs that suppliers charge new customers on March 1, 2023.
In addition to the monthly Monitor on the consumer energy market and the Monitor on wholesale tariffs and security of supply of natural gas, ACM from now on also publishes a monthly monitor with information about the wholesale markets for electricity.
See also
- 1-3-2023 Results of the checks on the prices of Eneco, Essent, and Vattenfall (in Dutch)
- 1-3-2023 Monitor on wholesale tariffs for electricity (in Dutch)
- Energy monitors (in Dutch)