Insufficient transparency in the energy market combined with people's lack of knowledge regarding energy contracts is resulting in more than a million households paying over the odds for gas and electricity.
More than 1.2 million households are paying up to €1,000 too much every year for electricity and gas, a recent analysis of current figures by the federal energy regulator CREG showed.
"Every year, CREG notes that many Belgian households can still reduce their energy bills significantly," the organisation said in a statement.
CREG argued this is the result of a combination of two factors, namely the continued lack of transparency in the energy market, but also the lack of knowledge among consumers about their energy contracts (not knowing the product name, for example). There is also insufficient knowledge about how energy contracts work.
It found that people choose contracts that are too expensive, make erroneous choices when changing contracts and/or suppliers, or keep highly-priced contracts for too long. "There are still large price differences between the cheapest and most expensive energy products on the market. The market share of the more expensive products is also considerably larger than that of the cheapest products."
Comparing offers
In response, it recently updated its application – the CREG Scan application – enabling consumers to check whether they are paying too much for their energy contract by comparing it to the rest of the market, as well as entering the name and date on which the contract was signed into the system.
Based on this information, the application indicates whether their current energy contract is still profitable versus the offer at the time.
In the second step of the application, consumers will then get an overview of the cheapest packages in real time, allowing them to compare prices according to their consumption.
CREG stressed that there are still around 460,000 households that are benefiting from low-price contracts for electricity and gas dating back to before the energy crisis. "These households are bound to lose out by switching suppliers."
Finally, the regulator has also called on energy suppliers to increase transparency by clearly stating the current product name and version month in their contractual communications with customers so they can make informed choices.
"A QR code could also provide direct access to the current rate card. This should make comparison even easier and remove an important obstacle for consumers who want to actively inform themselves about the market offer."
