Electricity and gas price brakes extended: Only slight relief for consumers after Russia's attack on Ukraine

Electricity and gas price brakes extended: Only slight relief for consumers after Russia's attack on Ukraine

According to a report by web.de, the state cap on gas and electricity prices in Germany has been extended until March 31, 2024. This regulation was originally introduced to protect consumers from the financial impact of Russia's attack on Ukraine. Although the energy markets have now stabilized, the continuation of price controls is seen as “insurance against unexpected risks”. However, the actual relief for consumers is likely to be small, as calculations by comparison portals show.

The experts at Verivox only expect an average reduction in electricity costs of 0.3 percent and a saving of 1.4 percent in gas spending. Check24, on the other hand, predicts savings of just 13 euros for electricity customers and 45 euros for gas customers in a sample household. The Association of Municipal Companies (VKU) and the Federal Association of the Energy and Water Industry (BDEW) also criticize the fact that the extension of the price caps was only decided a month and a half before the turn of the year, which could lead to delays in billing.

Given this information, the extension of government price controls could have only a limited impact on the energy market and the financial sector. The small savings for consumers could mean that the long-term impact of price caps is minimal. It remains to be seen whether further measures will be taken to ease the financial burden of energy costs on consumers.