Fixed and variable electricity tariffs each have their own advantages and drawbacks, which vary across Europe. As of January 2025, fixed prices are slightly lower than variable contracts on average in 14 countries.
In 2023, households in the EU spent 4.6% of their budget on electricity, gas, and other fuels, down from 4.9% in 2022 but still above the 4.1% recorded in 2019. Energy costs spiked following Russia’s invasion of Ukraine in 2022, making it more important than ever for households to secure the best energy tariffs.
Euronews Business explores electricity tariffs across 14 European countries to compare contract types, assess the cheaper options for households, and examine whether the choice truly matters.
The data, reflecting prices as of January 3, 2025, comes from the Household Energy Price Index (HEPI), compiled by Energie-Control Austria, MEKH and VaasaETT.
An electricity tariff consists of two main cost components:
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Standing charge: A fixed daily fee for maintaining the energy supply to your home, regardless of how much you consume. This charge primarily covers distribution and metering services.
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Unit price: The price you pay for the electricity you use, charged in pence per kilowatt-hour (p/kWh)
Based on data from energy suppliers, including British Gas, residential electricity tariffs come in various forms but primarily fall into two main categories: fixed and variable.
Fixed Tariff: Your unit rate and standing charge remain the same for the duration of your contract with your energy supplier, usually lasting one year or longer. However, your bill is not fixed. You pay based on your actual consumption.
Variable Tariff: Your standing charge and unit rates can increase or decrease, based on changes in wholesale energy costs and the price cap set by the national energy regulator. This means your bill could increase or decrease from month to month, even if your energy usage remains the same.
As of early January, the average residential end-user electricity price in the capital cities of 14 European countries was 30.05 c€/kWh for fixed contracts, while consumers on variable tariffs paid 31.04 c€/kWh.
This indicates that, on average, variable tariffs were 3.3% more expensive than fixed tariffs.
Electricity prices for fixed tariffs ranged from 18.29 c€/kWh in Helsinki to 41.26 c€/kWh in Brussels. In contrast, variable tariffs varied from 17.02 c€/kWh in Helsinki to 41.99 c€/kWh in Berlin.
Among the 14 capital cities, fixed tariffs were higher than variable rates in five: Stockholm, Copenhagen, Helsinki, Brussels, and Rome.
When comparing fixed and variable tariffs in each city nominally, the smallest difference was recorded in Lisbon at 0.37 c€, while the largest was in Paris at 5.44 c€.
In addition to Paris, four other cities saw a price difference of more than 3 c€ between fixed and variable tariffs. These included Dublin (4.79 c€), Rome (3.8 c€), Brussels (3.38 c€), and Amsterdam (3.33 c€).
This suggests that choosing between a fixed or variable tariff can have a significant impact on your bill.
In percentage terms, Paris had the largest difference, with electricity prices in variable contracts being 20.8% higher than fixed tariffs. Dublin (15.8%) and Amsterdam (13.4%) followed closely behind the French capital.
This difference was below the European average of 3.3% (across 14 cities) in three capitals: Lisbon (1.4%), Stockholm (2.5%), and Copenhagen (3%). Notably, in the two Nordic capitals, fixed contracts were more expensive than variable ones.
Is a fixed tariff always the more affordable option?
A simple ‘yes’ or ‘no’ answer isn’t possible, as this is a complex issue that varies by country and market conditions.
Rafaila Grigoriou, HEPI project manager & head of VaasaETT’s Greek office, and Iliana Papamarkou, senior data analyst at VaasaETT noted that the prices of fixed and variable electricity tariffs have historically been relatively similar. However, during the energy crisis the situation changed, with fixed-price tariffs surging well above variable ones due to the uncertainty in the market.
“In some cases, fixed-price offers became even unavailable for a period of time, during the peak of the crisis”, they added.
For example, a chart from the VaasaETT report, prepared for the Commission for Electricity and Gas Regulation (CREG), illustrates how electricity prices per kWh in fixed tariffs were nearly double those of variable tariffs in Great Britain during the 2022 energy crisis following Russia’s invasion of Ukraine.
According to Grigoriou and Papamarkou, this trend has been reversing since early 2023. In recent months, fixed tariffs have once again become, on average, the cheaper option compared to variable tariffs.
“Generally, the situation largely varies per market and even by supplier within a market, depending on several factors related to national policies, generation mix, procurement strategies for suppliers, seasonality, weather conditions, implication of gas etc,” they explained.
How to choose the best electricity tariff?
Grigoriou and Papamarkou of VaasaETT emphasises that there are market-specific or even tariff-specific cases where consumers can benefit from a cheaper fixed or variable offer.
“Savings can be achieved from consumers by actively comparing available offers through comparison tools, thus raising consumer awareness is considered a key factor to ensure energy affordability,” they recommended.
The rise of dynamic offerings and hybrid tariffs – blending elements of both fixed and variable pricing models – provides consumers with even more choices.
“They can be highly beneficial for consumers with specific consumption needs. These types of offers already exist in several European markets, while a growing trend is observed lately from more countries to offer such options,” Rafaila Grigoriou and Iliana Papamarkou said.
For a detailed look at electricity and gas prices across more than 30 European cities, check out our comprehensive article.
Disclaimer: This information does not constitute financial advice, always do your own research on top to ensure it’s right for your specific circumstances. Also remember, we are a journalistic website and aim to provide the best guides, tips and advice from experts. If you rely on the information on this page then you do so entirely at your own risk.
