In the past year, 2.4 million Europeans installed an energy management system (EMS), according to Solar Magazine. This growth shows an increasing need for efficient energy use and cost management. An EMS allows households and businesses to accurately monitor and optimize their energy consumption, leading to significant savings and a reduced carbon footprint.
According to Flemish energy regulator VREG, in the second quarter of this year, 78% of Flemish households had a variable electricity contract, while 22% had a fixed contract. Before the 2022 energy crisis, this was the reverse, but when energy suppliers stopped offering fixed contracts during the crisis, many families switched to variable contracts.
Fixed contracts: stability at a price
A fixed contract offers the security of a stable energy price for usually a year. This can be attractive for those who want to protect themselves from possible price increases, but this stability often comes with a higher price because of the risk that suppliers build in.
Variable contracts: flexibility and potential savings
Variable contracts adjust to market prices, allowing consumers to take advantage of falling prices but also risk increases. Rate adjustments usually occur monthly or quarterly.
In general, variable contracts are cheaper because with fixed contracts, suppliers build in risk for possible price increases. According to Luc Demeyere, co-CEO of energy broker Enbro, fixed contracts are currently up to 33% more expensive than variable contracts.
What is the best choice?
The choice between a fixed and a variable contract depends on your expectations about future energy prices. With falling prices, a variable contract is more attractive. If you expect stable or rising prices, a fixed contract offers security, despite the higher costs. Demeyere currently recommends a variable contract because of the low probability of significant price increases and the stabilizing market.
The added value of energy management system (EMS)
Energy-conscious consumers and businesses can increase their benefits by integrating an EMS with their energy contract. An EMS provides detailed energy consumption data, helps identify inefficiencies, and can automatically turn appliances and systems on and off based on preset parameters.
Benefits of an EMS:
1. Understanding energy consumption: Detailed data helps identify inefficiencies.
2. Cost savings: Optimizing and reducing energy consumption lowers costs.
3. Sustainability: Reduces energy waste and carbon footprint.
4. Automation and smart control: Reduces consumption during peak hours and saves costs.
Synergy of EMS and energy contracts
Combining an EMS with a variable energy contract is advantageous. Users can track real-time energy prices and adjust their consumption to take advantage of lower rates. When prices rise, they can reduce consumption or shift to times with lower rates, maximizing the benefits of a variable contract and minimizing the risks of price volatility.
Conclusion
Switching to a fixed energy contract offers security but is often more expensive than a variable contract. Given current market trends, a variable contract seems more advantageous for now. Integrating an EMS can help manage energy consumption more efficiently and further reduce costs. This combination offers financial benefits and contributes to more sustainable energy consumption. Platforms such as Gaele.be can help track the most advantageous energy tariffs and make the best choice for your situation.
