Energy, a guide to orienting oneself in the jungle of the free market

2023 begins in the name of chaos for electricity and gas bills linked to contracts stipulated on the free market. After the pronouncement of the Council of State in December, which suspended the Antitrust provisions against the increases, and the provision included in the Milleproroghe (which allows adjustments to the expiry of the economic conditions) the utilities are implementing the price increases of the energy proposed starting from last summer, with an advance of 90 days to allow for a possible withdrawal, and therefore with effect from December, January and February.

Letters on “Adjustments”

In the meantime, the letters are arriving to announce the adjustments that will take place from March onwards. The cross-section of what is happening these days is wide and varied and is obviously creating great confusion among families and small businesses. It is the effect of the volatility of energy prices, in particular of gas with which electricity is mainly produced in Italy. In the summer, gas prices on the indexes linked to the Dutch TTF platform had exceeded 300 euros per megawatt hour; these days they have dropped below 70 euros. The upward push on the cost of energy after the start of the war in Ukraine has forced utilities to take cover. Households and businesses with contracts linked to the enhanced protection, therefore indexed to three months and (now) to one month for gas, immediately suffered the increases.

How fixed contracts change

Customers on the free market, until last year largely covered by fixed-price contracts, in 2022 spent 40% if not 50% less than the others. Then the economic conditions of the first fixed contracts at 12 or 24 months began to expire. The expected increases compared to the previous conditions – in many cases dating back to the end of 2021 or the beginning of 2022 – were up to 3-4 times higher. This means that if a family with an average consumption (2,700 kilowatt hours per year) with a fixed contract in 2022 spent 600 euros (in some cases up to 900 euros), with the new conditions it has seen costs explode to 1,500- 2 thousand euros.

The moves of the multiutilities

For the gas bill (1,400 cubic meters a year) the average expense between 1,000 and 2,000 euros a year has risen to 3,000 euros, with even higher peaks. These economic conditions have been proposed, in particular, by the utilities which have decided to continue offering customers the possibility of having fixed-price conditions: among these Iren, A2a, Engie, Enel. Among the reasons, also the fact that the Antitrust had interpreted the change from fixed to indexed as unilateral changes without this possibility having been expressly provided for in the contracts. Companies such as Eni Plenitude have instead suspended fixed-rate offers since last year. Acea has also adopted this orientation.

Nobody offers the fixed price anymore

The truth is that since last summer, no utility has offered fixed-price offers to new customers. Not only. The harsh reality that emerges, after the prohibition of unilateral changes to the Aiuti Bis decree, the intervention of the Antitrust, the decision of the Council of State and the Milleproroghe is that no utility at this stage is willing to take on new customers. This means that there is no more competition on offers on the market and this limits the possibility of finding an alternative if your bill is not considered satisfactory. At the moment, the most perplexed customers are those who received the proposals to modify the economic conditions at a fixed price between September and December, which expressed the trend of the very high prices of those months.

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Energy, a guide to orienting oneself in the jungle of the free market

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