Concerns about crippling energy prices are still fresh in people's minds, but new warnings of alarming price spikes are already simmering.
Russia's invasion of Ukraine caused gas prices to soar last year, with energy bills hitting a peak in autumn when nightmare stories of energy bills three times more expensive made headlines. Governments worldwide, Belgium included, intervened to ease consumer bills.
The situation has since stabilised and in Belgium consumers were recently urged to lower their advance payments for energy bills. Yet Fatih Birol, head of the International Energy Agency (IEA), has warned that gas prices could once again soar this winter.
Birol told the BBC that China is purchasing massive quantities of energy on markets as it fires its economy up. He cautioned that "combined with a cold winter, pressure will increase on gas prices" and added that he "wouldn't rule out blackouts".
Leaving consumers in the cold?
Birol stressed that soaring prices will hit consumers and it could force governments to once again step in with measures.
Belgium adopted several support measures during the energy crisis to cushion the impact of energy price inflation on households and businesses. Most notably, this included the energy package which discounted energy bills and lowered VAT on electricity and gas from 21% to 6% between April 2022 and April 2023. Most energy support measures have since been phased out.
Most recently, the government was criticised for ending the extended social tariff introduced to help the most vulnerable households, resulting in some 800,000 customers seeing bills go up steeply as they are charged commercial energy prices again.
While suppliers will be obliged to apply the cheapest tariff for a period of three months, the Federal Energy Ombudsman expressed concern, stressing that government bodies must monitor the situation closely to ensure that suppliers do indeed apply the cheapest tariff to those previously on the social tariff.
The measures currently in place include several financial incentives for carrying out energy efficiency renovations and a cap on market revenues for electricity producers over the same period. The VAT rate for electricity and gas remains at 6%, but part of that cut will be offset by higher excise duties.
Green investments needed
Last year's energy crisis already gave renewable energies a major boost as fossil fuels became prohibitively expensive, an IEA report showed in December. In May the agency announced that global investments in clean energy technologies were rising rapidly and outpacing fossil fuels.
However, investment in the oil and gas industry has risen and coal consumption in Europe rose last year. Russia's war in Ukraine led to a rush for fossil fuel exploration, at odds with international climate scientists who say fossil fuel projects must be closed rather than expanded.
In his latest interview, Birol stressed that the risk of soaring gas prices should prompt governments drive up investment in renewable energy and shorten the process of acquiring permits to minimise reliance on third countries for energy.
Offshore wind farm in the North Sea, Wednesday 20 October 2021 in Oostende. Credit: Kurt Desplenter
The energy transition in Belgium is progressing, as highlighted in the European Commission's 2023 country report published in May, which noted that has taken significant steps to reduce its dependency on Russian gas, in part by further developing offshore wind energy infrastructure.
However, it stressed that the country "faces significant challenges in moving to a green and climate-resilient economy," citing Belgium's "strong dependence on imported fossil fuels" as a particular obstacle to climate neutrality by 2050.
"Further policy reforms and additional investments to reduce greenhouse gas emissions in the energy sector would also help reduce Belgium’s high dependency overall on fossil fuel imports and help ensure the security of supply," the Commission report read.
