Belgian households and small-medium enterprises (SMEs) paid less in early 2024 for their electricity and gas than their counterparts in most neighbouring countries, according to a study conducted by consultancy firm PwC on behalf of four Belgian energy regulators.
The study compared the prices of electricity and natural gas in January 2024 with the previous year’s prices. It found that electricity bills for households and businesses on low tension networks in Belgium decreased in early 2024, although prices remained significantly higher compared to pre-energy crisis levels.
Federal Government measures like VAT reductions to 6% on electricity for households helped to lower costs relative to neighbouring countries.
As per the previous year, electricity bills for Belgian households and businesses were the least expensive of the analysed countries, with the exception of France where standard household products remain government regulated.
Regarding natural gas, Belgium was the least expensive country for households of those studied in 2024. The difference was minimal with the UK, while the Netherlands was once again the most expensive for households. According to the study, network costs, levies and surcharges were relatively low in Belgium, and a 6% VAT reduction on natural gas for households played a key role.
For businesses, natural gas bills also significantly reduced in response to the drop in wholesale prices, which had surged in 2022 and 2023 due to the war in Ukraine.
Disposable income decreases
Now, energy costs for industrial users approach pre-energy crisis levels. Overall, Belgium remains competitive for natural gas due to its low levies, surcharges, and network costs. As in 2023, small businesses in Belgium had a more competitive gas bill than large companies.
The study also compared the proportion of disposable income that Belgian households and those in neighbouring countries dedicate to energy bills. In early 2024, Belgian households with an average income spent about 5.2% of their income on total energy bills, down from 6.7% in 2023. This percentage was lower than all neighbouring countries.
For the lowest income Belgian households, the proportion of total income spent on energy bills also declined this year to 7.8%. Again, Belgium fared better than neighbouring countries. For example, in the Netherlands, the energy bill accounted for about 11.5% of the income of the most precarious households.
Finally, the study examined the competitiveness of the most important industries in Belgium with respect to energy prices. It found that the competitiveness of Belgian industry improved significantly between 2023 and 2024.
All studied sectors in Flanders and Wallonia had a competitive advantage, for both non-electro-intensive and electro-intensive companies. However, heavy industrial baseload consumers (those using energy continuously) enjoyed more favourable electricity prices in France than in Belgium.
