Natural gas still a bargain for German households – report

Germans still get a relatively good deal on gas prices, and will continue to do so even after the introduction of a CO2 price in transport and buildings next year, a report by price comparison website Verivox shows. The average consumer cost for natural gas was 5.89 cents per kilowatt hour (ct/kWh) in the second half of 2019, putting the country in midtable when compared with other EU nations, it found. This is below the EU average of 6.7 ct/kWh, and half of the price paid by Swedes, who have the highest gas price (11.67 ct/kWh). Germany falls further in the table if the cost of living (local purchasing power) is factored into prices.

Verivox calculates that Germany’s new national CO2 price for heating and transport will add about 20 percent to gas bills by 2025, giving an estimated price of 7.08 ct/kWh. This means a family with an annual gas consumption of 20,000 kWh will pay 238 euros more than today. But the estimated price is still low: the Irish, Danes, Portuguese, French, Italians, Dutch, Spanish and Swedes already pay more than 7.08 ct/kWh. Verivox based its calculations on figures from Eurostat, the EU statistics authority, and the Federal Office of Economics and Export Control.

Natural gas is Germany’s second most important energy source after oil, providing about a quarter of the country’s energy needs in 2018. It is the most important heating fuel in German households, and is being heavily backed more widely in industry and transport as the best fuel to smooth Germany’s transition to renewables. However, it remains controversial, and the government is introducing the CO2 price to mitigate its use. This will involve a charge of 25 euros per tonne of CO2 emitted from 2021, rising to 55 euros in 2025. Countries including France, Sweden and Denmark have long had a CO2 tax.