The impact of taxes and levies on retail electricity tariffs
Centrica highlighted its average consumer tariff increase of just 1% p.a. in the UK since 2009 this week. Higher taxes and
levies have been offset to some degree by lower wholesale prices. But with levies unlikely to ease, we look at electricity tariffs across Europe, and the future impact.
* Centrica has shown a 1% increase in its residential tariff on average since 2009:
Whilst delivery costs and environmental and social policy costs have continued to rise, wholesale energy costs have fallen leading to limited average tariff growth. With rising wholesale prices, upside pressure could come - we have
already seen some UK suppliers announce large tariff increases starting in March.
* German tariffs have risen more than UK tariffs:
These are up 3% per annum on average since 2009, and 4% since 2006, driven by the increasing cost of delivery and renewables subsidies. German households now pay €35bn for taxes and levies on energy each year, according to the utility association BDEW. Tariffs are at record highs (although wholesale prices are not).
* We look at how electricity tariffs compare across European geographies, ranking the overall tariff, as well as looking at the amount of levy and tax within it. We also show the increase in this levy since 2012. We would expect taxes and levies
to continue to rise here - if commodities tick up, this could put further pressure on consumers in liberalised markets.