Faced with soaring energy prices, Guy carefully monitored the evolution of tariffs before signing a new electricity contract. A customer at Eneco, he did not expect to see his bill almost double by using this 100% “renewable and Belgian” electricity supplier. He therefore wonders if “the price of wind has also increased”…
Guy has watched the energy price boom in recent months carefully, and he says he’s completely surprised to see his bill go up like this. Via the orange button Alert us, he denounces what is for him a “scam“. “My 100% green supplier Eneco, with its 100 wind turbines, increases the price of its kilowatt hour by 700% in 12 months. Has the price of wind increased by 700%?”he asks himself.
Aged 80, Guy lives in a 4 facade house on the side of Grez-Doiceau (Walloon Brabant). The computer engineer by training specifies that it heats up with electricity and is a “heavy consumer“. “I have 25 photovoltaic solar panels on the roof and I have a budget of 5,000 euros per year. My bill practically doubles. I go from 5,000 to 8,800 euros (see bills below). But if you only take the part energy (distribution without transport), you see that the energy has increased by almost 700%”, he points out.
How do we arrive at these numbers? It’s incredible
Changing supplier every year, Guy says he signed a fixed-rate contract with Eneco last year, which ended on June 1. “It was 4 cents per kilowatt hour during the day and 3 at night. Now it’s almost 26. I wonder where that came from. If I go to the site Monenergie.be and indicate my consumption, I am given different contracts from different suppliers. It’s the same everywhere. The increases are the same at Engie for example”, he continues.
And to conclude: “There’s something going on in this market that doesn’t make sense and nobody seems to care. It all disappears in the electric bill. I don’t know how you get to those numbers, it’s amazing At this rate, people will have to sell their homes and will no longer be able to heat themselves.
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Third energy supplier in Flanders and fourth in Wallonia, Eneco is a sustainable energy supplier which therefore focuses on the production and supply of gas and electricity. This comes from renewable sources such as the sun and the wind.
Active on the Belgian market since 2011, Eneco claims to supply 100% green energy produced on Belgian soil via 107 wind turbines and more than 350,000 solar panels. In total, Eneco supplies more than 1 million residential customers and 55,000 industrial customers in Belgium with electricity and green gas.
But if the electricity is 100% “renewable and Belgian”, as the Eneco, why are prices rising so sharply? Should the company align itself with the European market? Is she obligated?
To justify these tariffs, Mark Van Hamme, spokesperson for Eneco Belgium, briefly replies that they “also buy their energy on the European market. We are for a large part also dependent on the latter”he points out.
“For example, if a customer signs for 3 years, we are obliged to buy energy for 3 years. We buy our energy in our own portfolio, but also on the European market for certain volumes. We are therefore partly dependent on these European markets which are increasing. We are obliged to align ourselves”, assure Mark Van Hamme.
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The question of the price of the wind is legitimate
According to Damien Ernst, professor at the University of Liège and specialist in energy issues, “It’s the easy answer to say they match European prices.”
The engineer explains the current model: “The wind that Eneco sells, he values it directly at the market price. Their profit margin increases on wind energy. What should be needed in the future in the supply contracts is that when you go to Eneco, you might benefit from this electricity at a cost price of the production by the wind turbine with a profit margin. But now, the suppliers will all resell their electricity on the wholesale markets, at wholesale market prices. This means that they are making superprofits with their wind turbines.”
Eneco might therefore choose to act differently: “He might very well say, I’m not going to sell it on the wholesale markets, I’m selling it to my customers, for part of the wind power, at a price that would cover the investment costs in the wind power plus a profit margin.”
Damien Ernst points out that the question Guy is asking regarding the price of wind is “legit”. “We discuss it very little, but the renewable sector is excess profit which amounts to billions. We should more put our finger on this excess profit which also takes place in nuclear energy. Eneco might very well sell part of its energy turbine at the production price. It’s the easy answer to say that they are in line with European prices.”
It is a choice not to rebate the excess profit
The expert puts forward an alternative to lower the bill. “Eneco might change the contracts and not expose its customers to the prices on the wholesale markets. It might say ‘electricity costs me with my wind turbines, 80 euros per megawatt hour (MWh), while it is 200 in the markets. He might try to ensure that he does not sell his electricity at 200 on the markets, sell it at 80, and rebate it to customers. There is nothing legally preventing him from doing so. It is a choice not to rebate the excess profit by selling its wind power on the markets. You have to make a conscious choice not to discount it.”
Damien Ernst emphasizes that the objective of Eneco and other companies remains to make a profit. “They have a business opportunity and they’re taking it. It’s their choice, it’s legal, but they can’t say they’re being forced to make that choice. It’s a business choice of a box that maximizes its profits. Saying that they have no choice but to align themselves with the European market and that they cannot pass on these excess profits to customers, that’s a choice. All the suppliers do it”, he concludes.
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