Elektrum Lietuva’s product development manager Mantas Kavaliauskas says that decisions related to electricity supply require careful evaluation of one’s electricity consumption habits and active interest in the services offered by electricity suppliers.
“When choosing an electricity supplier or plan, the most important thing is to take your time and calmly review the offers of all suppliers. It is best to do this by using the calculator of the State Energy Regulatory Council (VERT) – you only need to enter your monthly electricity consumption in the online system and the calculator will filter out the plans offered by all suppliers”, says the company’s representative.
A fixed electricity price will provide stability
If you choose a fixed electricity supply plan, the price per kilowatt hour will remain the same for the entire period specified in the contract. M. Kavaliauskas says that fixing prices will make it easier to predict the size of the future electricity bill.
“Choosing a fixed electricity price guarantees a stable electricity price even in the face of serious electricity market turbulence, so the user will be protected from unexpected electricity costs,” says the Elektrum Lietuva representative.
Consumers who have chosen a fixed electricity price plan also need to decide for which period – 10, 12, 20 or 24 months. – would like to fix the price.
“After evaluating the market characteristics and seeing the advice of customers, it is recommended to fix the prices for no longer than 12 months. for the period. This choice helps to avoid price jumps and major changes in the market. In addition, experts advise to rationally evaluate the price stipulated in the contract exactly once a year”, says M. Kavaliauskas.
Non-fixed electricity price plans involve higher risks
At that time, consumers who chose a non-fixed price plan will pay a variable price for electricity, and it will depend on the selected exchange rate – hourly or monthly. Consumers who have chosen the hourly exchange rate will pay the price per kilowatt-hour that will be at that time on the NordPool exchange. In addition, such a plan requires the installation of a smart electricity meter.
“Since there are significant price fluctuations in the exchange, consumers who have chosen the hourly exchange rate should responsibly follow the exchange prices and adjust their electricity consumption accordingly. As recently as this month, the price of one kilowatt hour on the stock exchange reached even 600 EUR, so turning on the washing machine at such a time can significantly increase the monthly electricity bill.
For those who have chosen the monthly exchange plan, the electricity bill will be calculated by evaluating the data of the entire monthly consumption and applying the weighted average price of the NordPool exchange. It is important to mention that this is not a specific monthly average, since the coefficients of the unevenness of electricity consumption provided by the ESO are used to calculate this average”, says M. Kavaliauskas.
The expert notices that the hourly exchange plan is usually chosen by consumers who are actively interested in the electricity market, closely monitor consumption and are ready to adapt to exchange price fluctuations.
At that time, according to M. Kavaliauskas, the monthly plan of the exchange is more often chosen by consumers who still have old-style electricity meters, who change their consumption habits a little less flexibly.
For the undecided – electricity supply assurance service
Electricity consumers who have not chosen an independent electricity supplier can use the guaranteed supply service for 6 months. In this case, the bill is formed by calculating the average price of the electricity exchange of the previous month and applying a coefficient of 1.15 (for business customers, this coefficient is slightly higher – 1.25).
However, M. Kavaliauskas draws attention to the possible risks of such a choice. One of them is the variable and difficult to predict electricity price.
“The bills of consumers in guaranteed supply consist not only of the price of electricity – the prices of electricity transfer, distribution and other additional services also contribute. In addition, it should be remembered that the price of guaranteed supply is indicated without value added tax”, says M. Kavaliauskas.
Therefore, according to the company’s representative, the warranty supply is only a temporary and quite expensive solution. If a decision on the choice of an independent electricity supplier is not made within half a year, ESO has the right to terminate the electricity supply.
Tariff and monthly fee – what ratio determines the final price?
When choosing an electricity supplier or plan, the calculators show not only the price of electricity, but also the monthly (subscriber) fee of the service provider. According to M. Kavaliauskas, it is best to make the best decision regarding the price only after evaluating the offers of all electricity suppliers. However, it is also important to pay attention to what part of the final bill is the monthly fee.
“Usually, if we calculate an average of 150 kWh/month. consumption, this tax is up to 6 percent. the size of the bill and usually amounts to several euros”, says M. Kavaliauskas.
Therefore, according to the company’s representative, when choosing an electricity supplier or plan, the most important thing is to evaluate the rate – this is most relevant for those consumers who consume a lot of electricity every month.
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