Iseteenindus

An energy expert explains: Why should you fix your electricity price for a short term?

29.01.2024

It is estimated that electricity contracts will expire in more than 50,000 Estonian households in the next three months. Consumers who do not want to risk fluctuations in the exchange price should fix their electricity price for six months and choose electricity based on 100% renewable energy, said Santa Tohver, Head of the Estonian Market at Enefit.


According to Tohver, there are two reasons why there are currently so many customers with electricity packages that are about to expire. First, in the light of last winter and the high prices caused by the energy crisis, many customers decided to fix their electricity prices for a year. Second, low electricity prices in the summer and favourable market forecasts made it possible to offer customers affordable six-month electricity packages, which are now about to expire.

‘The beginning of the year showed that users of exchange-based electricity packages must be prepared for very high price peaks. Now that several homes need to choose an electricity package for the next period, it would be reasonable to review their electricity consumption and decide whether it would be more beneficial to buy electricity at the exchange or at a fixed price,’ Tohver explained. ‘For example, almost 70% of Enefit's private customers use a fixed-price package.’

Tohver added that it is reasonable for the proponents of both exchange and fixed electricity packages to choose renewable energy in the long term. *‘*Choosing a green electricity package will make it possible to accelerate investments in the development of renewable energy production and thereby increase the entry of renewable energy into the market,’ Tohver explained. ‘The more electricity we can produce from renewable sources, the faster electricity prices will fall, allowing us to offer more affordable packages.’

This is exactly what has happened recently: more and more electricity is produced from renewable sources, and therefore green energy has also become more accessible to many customers. On Enefit's website, it is possible to compare the prices of all conventional electricity packages with 100% renewable energy-based or green packages. ‘From there, you can see that the price differences between conventional and green electricity are small. Therefore, now is a good opportunity to take a step towards a more sustainable future on the green journey,’ said Tohver. ‘Every person can contribute by choosing green, 100% renewable energy instead of the conventional electricity package.’

But for how long should you conclude an electricity contract?

‘We have observed that in late spring and summer, electricity prices are lower, and during these periods it is also possible to offer customers fixed packages at a more favourable price,’ Santa Tohver explained. ‘Therefore, the best option at the moment may be to fix your electricity package for a short period of time, ie for six months, in order to enter a new, longer contract during the summer, when prices are lowest.’

Enefit is a subsidiary of Eesti Energia, which as of 1 January 2024 offers the existing energy products and services of Eesti Energia: electricity and gas, solar and storage solutions, home and public electric car charging solutions, insurance, electrical works, and heating solutions. As of 2024, all Eesti Energia's customers are the customers of Enefit.