tariffs of the largest energy companies are not unreasonable

The rates currently charged by the three largest energy companies in the Netherlands – Essent, Eneco and Vattenfall – are not unreasonable, the Authority for Consumers and Markets (ACM) concludes after an investigation. According to the regulator, profit is currently no higher than in previous years. Last year it was between 0 and 5 percent.

ACM director Martijn Snoep says he understands that people perceive the prices as unreasonable. “There may be a suspicion that extra high profits are being made by the energy suppliers. That is not the case. After deduction of all costs, the profit is a maximum of a few tens per household per year.”

The high prices are the result of the high purchasing costs for gas and electricity that the suppliers have to incur. In addition, ACM notes that companies also pay more for the insurance policies they have to take out to cover risks related to the “tumultuous energy market”.

All three energy companies buy the energy at least a month in advance – and often earlier. As a result, consumers do not immediately see the falling energy price on the market reflected in their own bill. This is expected to happen in the coming months. Chairman of the Board Snoep says he will keep a close eye on this.

For the investigation, ACM and experts visited the head offices of the three largest energy companies. They were allowed to look into the books and systems there and were also given access to confidential company documents about the purchasing strategy. In the coming period, ACM will also be scrutinizing the tariffs of other major suppliers. There, too, there are no concrete indications that things are wrong.

Around noon, ACM will publish a new monthly monitor in which consumers can see what the energy rates are for new customers. The prices of new variable contracts have fallen by 10 to 20 percent compared to last month.