"After the previous price reductions, electricity and gas may become more expensive again from 2024," Birnbaum told the Rheinische Post according to an advance report. The causes are the increase in VAT for gas and the discontinuation of the damping of the transmission system operators' grid fees on electricity prices. "In many cases, the end of the price brake will have an additional effect."

According to the preliminary report, Birnbaum expects all suppliers to pass on the increase in taxes and grid fees: "These are politically induced surcharges that all suppliers will have to pass on to gas and electricity customers. Perhaps not immediately, but probably in the coming months." Should there be an escalation in the Middle East, this would also have an impact on all energy markets.

Compared to the record prices in the fall of 2022, there has been a significant decline, said Birnbaum. "But prices are still around twice as high as before the crisis. The wholesale price for electricity was EUR 50 per megawatt hour at the beginning of 2021 and is still almost EUR 100 today."

The E.ON CEO does not expect prices to fall back to 2021 levels. "Although generation from wind and solar costs comparatively little, the hedging - keyword dark doldrums - through storage or new gas-fired power plants and the connection of the many decentralized energy transition plants nevertheless increases the overall cost of supply."

(Report by Esther Blank. If you have any questions, please contact our editorial team at berlin.newsroom@thomsonreuters.com (for politics and the economy) or frankfurt.newsroom@thomsonreuters.com (for companies and markets).)