The annual energy cost analysis for German households reveals a significant financial burden. With electricity prices showing a slight decrease in 2024, gas costs surged. What can consumers expect in 2025, and how can they save?
Electricity Prices in 2024: A Mixed Bag
Electricity prices in 2024 brought some relief to many households, with an average drop of around 4%, according to a study by the comparison platform Verivox. A four-person household in a single-family home paid approximately €0.36 per kilowatt-hour (kWh), with the average price decreasing from €0.374/kWh at the start of the year to €0.358/kWh by December. For a household consuming 4,000 kWh annually, this translated to an average cost of €1,426.
However, households under basic supply tariffs from local providers faced significantly higher costs, around €0.44/kWh. This meant annual expenses of approximately €1,757 for the same consumption level.
Thorsten Storck, an energy expert at Verivox, highlighted that over half of electricity costs are fixed components like grid fees, taxes, and levies, which consumers cannot control. Storck advised households to explore competitive offers: “Suppliers purchasing electricity at lower wholesale prices can offer attractive rates to new customers. Consumers should leverage this competition to avoid overpaying for electricity.”
Gas Costs Soared in 2024
Unlike electricity, gas prices saw a notable increase in 2024, rising by about 9%. The average price per kWh climbed from €0.107 in January to €0.117 in December. March witnessed the sharpest hike, coinciding with the reinstatement of the standard 19% VAT on natural gas, after a temporary reduction.
A household in a single-family home consuming 20,000 kWh annually faced an average cost of €2,210, equivalent to €0.11/kWh. In basic supply tariffs, this rate surged to nearly €0.14/kWh, leading to even higher expenses.
Storck emphasized potential savings for gas consumers: “Switching from basic supply tariffs to the most affordable new customer rate can save households over €800 annually. Reviewing your current tariff is essential.”
What Lies Ahead for 2025?
As the new year begins, early data suggests varying trends in energy costs. Average electricity prices for households in regional basic supply tariffs increased slightly (+0.3%). While Verivox observed 366 instances of electricity price reductions by local suppliers, there were 79 cases of price hikes. Despite more reductions than increases, a larger number of households are expected to feel the impact of higher prices.
In contrast, gas prices showed a marginal decline (-0.5%) at the start of 2025. Regional variations are evident here too. While 92 suppliers raised gas prices, 271 implemented reductions, providing some respite for consumers.
Strategies to Mitigate Costs
For both electricity and gas, the key to savings lies in choosing competitive tariffs. Households should regularly compare offers and switch to more affordable plans when possible. With energy prices remaining volatile, staying proactive can significantly ease financial strain.
