Posted by: Dr. Breffni Lennon | June 19, 2012

European Energy Review: can German consumers remake their energy sector from the bottom up?

Consumers within Germany’s energy market have been slow to respond to the options inherent in deregulation according to Paul Hockenos (2012). Since 1998, when the market was opened, only 28% of Germans have changed their electricity supplier and only 18% switched to new gas companies. Compare this to the UK, where 61%  of domestic electricity consumers and 58% of gas customers have transferred to new suppliers; or in Ireland where 40% have switched since 2009, it becomes obvious that German consumers have been traditionally cautious about embracing such behavioural mobilities. However, this is changing according to Hockenos.

“Although Germany’s energy sector has been liberalized for over a decade, German consumers have been slow to embrace the opportunities of the free market, certainly compared to countries like the UK and Ireland. The main reason is that they are fearful of being cheated and uncertain about the advantages. Still, the German energy market is changing slowly but surely. New green (and nuclear-free) energy providers are making inroads, the big incumbent suppliers are offering new products and, most surprising of all, the old Stadtwerke are being bought back by municipalities and eagerly competing in the market. The government in Berlin meanwhile has adopted new laws designed to make switching a piece of cake, which could give another boost to the free energy market in Germany.”

(Paul Hockenos, 2012)

The article can be access in full here.


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