Electricity in Germany – How to Save Money and Find the Best Provider

When you live in Germany, you will have to find your own electricity provider in most cases. In this article, you will find everything you need to know about electricity in Germany. This includes how to find the best provider, what factors to consider, how to save money, and more.

Is electricity included in rental contracts in Germany?

In Germany, rent is divided into two parts: cold rent (Kaltmiete) and warm rent (Warmmiete). Cold rent does not include utility costs like hot water, heating, electricity or gas, trash collection, snow removal on the street, and any other cleaning services in the building. So, you will have to pay them on top.

When I moved to Germany, it was extremely difficult for me to find a place to live. I used to live in different shared flats in Germany when I was a student. The rental contracts were for short period (3 to 6 months). So, I was paying an all-inclusive warm rent and did not have to worry about the extra utility costs.

However, unless you live in a shared flat, your rental contract will most likely state a cold rent. And you will have to pay other utility costs on top, depending on your usage.

Paying electricity cost to your electricity provider directly

When you rent your apartment in Germany, you will have to pay your hot water and heating costs to your landlord. They are part of the warm rent. The more hot water and heating you use, the more expensive your warm rent will be.

In most cases, electricity cost is separated from the warm rent. It means that you have to sign up with an electricity provider yourself. You have to pay your electricity cost directly to the electricity provider. Not to your landlord. If you plan to rent for a longer period, it makes sense to search for the cheapest electricity provider.

There can be exceptions depending on your rental contract. If you are not sure whether you can choose your own electricity provider, you should check your rental contract or ask your landlord.

Read also: 

• Cost of living in Germany – How to save money?
• How to Save Money During a Crisis – 8 Best Tips to Save and Earn

Default electricity service (Grundversorgung)

Depending on your rental contract, you will probably need to find an electricity provider when you move to your new place in Germany. Normally, your former tenant will cancel his electricity contract when he moves out (after the meters are read).

But don’t worry if you forget to sign an electricity contract. You will still have electricity at your new place. A default electricity service (Grundversorgung) will be applied to you once your former tenant cancels his electricity contract. Your electricity will be provided by the default electricity provider. The default provider is different depending on your city. This is to ensure that you have an uninterrupted supply of electricity. Nothing needs to be built or changed physically.

However, the default electricity service is expensive

That’s why you should always look for a new electricity provider, rather than keeping the default electricity service. Your new electricity provider will usually give you a backdated contract, which covers the time from your former tenant’s cancellation. But you will have to find one within a few weeks after moving in.

Failing to do so within this time means that you will have to pay your default electricity provider. The bill will start from the time when your former tenant cancels his contract. It will last until you sign up with another electricity provider.

So, it is wise to switch the electricity provider as soon as you move into your new place. We bought our house in Germany a few years ago and made this mistake when we moved there. There was so much going on that we didn’t think about our electricity provider. We ended up paying much more for years and only changed our provider recently.

The switch was so easy that I couldn’t believe it. Everything was done online in minutes. Our new provider even helped us to quit our old contract. So, we didn’t have to deal with anything else except filling in the form from the new provider. Also, no physical change is needed and nothing needed to be built.

How to find the best electricity provider in Germany?

There are more than 1300 electricity providers in Germany. Some of them operate nationwide, while some others operate only in certain regions. The market is very competitive. Every provider wants to win more customers by offering a cheaper price or bonuses. The offers can differ significantly in terms of price and conditions. So, it makes sense to shop around and find the best deal.

Our recommendation

We recommend using Ostrom as it offers electricity plans that are fair, smart, and green. Besides, its services are in English and expat-friendly. Some highlights of Ostrom below:

• 100% green energy
• Customer support in both English and German
• Manage everything from an app
• One simple plan with no confusing fees
• Flexible monthly billing (no 24-month lock-in)

Sign up with Ostrom now!

Use a comparison tool

Alternatively, you can find an electricity provider in Germany by using a comparison tool like Check24. Instead of checking the websites of individual providers one by one, you can see all the deals in one place. Besides, Check24 often has special deals with electricity providers. So, you may get a better price when purchasing through Check24, comparing to purchasing at the providers directly.

Click here to see a detailed step-by-step guide on using Check24 to find the best electricity provider in Germany

The Check24 website is in German. If you are not familiar with the German language, you can easily translate the page to English using a Chrome browser. In general, the tool is very easy to use and pretty self-explanatory.

Enter your basic information for the search

Go to the tool and enter your basic information:

• Postal code (Postleitzahl)
• Your location (Ort)
• Number of people in your household (Personen im Haushalt)
• Maximum contract period (Vertragslaufzeit)

The tool will calculate an estimated electricity consumption for you, based on the number of people in your household. After entering all the above information, you can click compare (vergleichen).

Compare different electricity providers

Now, you can see the offers from different electricity providers. For example, the price, the contract period, the sources of electricity, any new customer bonus, and any immediate bonus.

For each of the electricity provider, you can also click to expand and see more details (Tarifdetails). Here you will see the basic fixed price per month (Grundpreis), and the charge rate based on your usage (Arbeitspreis).

On the top, you can find a filter where you can sort your search further. For example, you can filter to see providers with renewable energy only (Ökostrom) and offers with bonus or without bonus (Bonus einberechnen).

Once you choose your provider, you can click next (weiter).

Sign up with your chosen electricity provider

After choosing your provider, you will come to a page saying that you are about to change your electricity provider, or order a new electricity contract. You can finish the sign-up process in 5 minutes and there is no extra fee for using Check24.

Besides, you will have 14 days to revoke your order if you change your mind after ordering.

Just click next (weiter).

Address (Adresse)

Now, you will come to a page where you need to enter your personal information: your email, name, address, birthday, etc. You will need to indicate as well if you moved in newly, the date of moving in, and the type of moving in (whether someone lives there before you).

You can also put in another billing address, in case it is different than your living address.

Connection (Anschluss)

Enter the number of your electricity meter (Zählernummer) here. If you are currently using another electricity provider, you will need to provide its information as well.

Payment data (Zahlungsdaten)

You can either pay by direct debit (Lastschrift) or bank transfer (Überweisung). Enter your bank details if you choose direct debit.

Confirmation (Bestätigung)

Confirm your order by clicking “Complete purchase” (Kauf abschließen). That’s it. You are done!

How to benefit from the energy price brake (Strompreisbremse) in Germany?

As you probably know, German consumers were hit hard by the energy crisis in 2022. The good thing is that the German government has rolled out an energy relief package called the “Strompreisbremse” to provide some relief. In English, this would be the “energy price brake”.

In short, 80% of your base energy consumption will have a fixed unit price of 50 cents per kWh. The remaining 20% will be charged at the rate determined by your energy provider. This is to relieve you from high energy bills, while still giving you the incentive to reduce your energy consumption.

Want to learn about more details on how you will benefit from the Strompreisbremse in Germany? Check out this article!

Factors to consider before choosing your electricity provider in Germany

Notice period (Kündigungsfrist)

The notice period determines how fast you can quit your contract. I would choose a contract with a notice period of six weeks maximum to stay flexible.

Contract length (Vertragslaufzeit)

The contract length can range from 2 weeks to 24 months. I would choose a provider with a contract length no longer than 12 months.

You should also pay attention to the contract renewal period (Verlängerung). Make sure that it is a short period so that you can easily change your provider in the future.

Note that if you are moving somewhere else and it is not possible to use the same electricity provider anymore (or it will become more expensive to do so), you have the right to quit your contract earlier.

Tips: There is a new law in 2022 that regulates the automatic renewal period. If you sign a contract on or after 1.3.2022, you can quit your contract with a maximum notice period of 1 month (as long as you have already passed your original contract period.)

Payment frequency (Abschlagszahlung)

The competition in the electricity market is very intense. Some small companies went bankrupt in the past and people lost their money that they paid in advance. So, to reduce risk, I recommend finding a provider with monthly or quarterly payments, instead of yearly payments.

Price guarantee (Preisgarantie)

The price of electricity in Germany fluctuates a lot and it has been increasing in the past years. This is because of the investment in renewable energy and the high electricity demand. Many electricity providers offer a price guarantee for a period of time. They guarantee that the price per kWh will stay the same during this period.

To make sure that the price will not change after you have signed up, you should find a provider with a price guarantee that covers the whole period of your contract.

Bonus

If you use Check24 to find your electricity supplier, you may see two kinds of bonuses: immediate bonus (Sofortbonus) and new customer bonus (Neukundenbonus).

An immediate bonus can be offered by the electricity provider itself, or by Check24. Remember that all these bonuses are only applied one-time in the first year. The price displayed on Check24 shows only the first year’s price. So, the price can go up in the second year without the bonuses if you continue to use the same provider.

The bonus payment can be very tricky sometimes and you have to be careful. We will talk more about it in the next session.

Customer review

In Check24, you can see if the electricity providers are recommended by their customers (Weiterempfehlung). Choose a provider that other people recommend.

Sources of electricity

In Germany, producers of renewable energy are subsidized by the government. That’s why even if you choose an electricity provider with 100% renewable energy, it doesn’t mean that the price will be higher.

Every electricity provider needs to show you where its electricity is coming from. I see no reason not to pick a provider with renewable energy, especially when the price is similar.

Check the price components

The price you pay consists of a fixed price (Grundpreis) and a charge based on your usage (Arbeitspreis). If you consume a lot of electricity, it is better to find a contract with a low Arbeitspreis. On the other hand, if you are often not at home and do not consume much electricity, you should find a contract with a low Grundpreis.

Note that some electricity providers may refuse your application or charge you a higher price if you have a bad SCHUFA score (your credit score in Germany). So, you should try to keep a good SCHUFA score. For more details, check this out: What is SCHUFA – How to get SCHUFA in Germany?

How to save money on your electricity bill?

Switch your electricity provider regularly

This is the best way to save money. I am sure that you will find a better deal from another provider if you switch to a new one after your contract term (especially if you are using a default electricity provider now). Don’t believe me? Try to do a search and see.

Interestingly, more than half of the consumers in Germany seldom change their electricity provider even though they can save more than 100€ by doing so. Either they are too lazy, or they don’t know about the process. The price difference is so big that one can save 20% – 30% of his electricity bill each year. Well, many people in Germany do not even know how much they are paying for their electricity.

We switched our electricity provider recently and saved 130€ per year. The whole changing process took us only a few minutes online. The new provider also notified the old provider to switch the contract. It was super easy and we are going to do this again every year now.

Don’t overpay your electricity bill anymore. Switch your provider immediately after your contract term to save money!

Don’t just accept a higher price

If your current electricity provider is going to raise the price, it has to inform you of the new price 6 weeks ahead. During this time, you have the chance to switch to another provider before they charge you a new price.

Be aware of the notice period

Like all the other subscriptions in Germany, if you don’t cancel your service in time, your electricity contract will be automatically renewed. So, if you plan to switch your provider to take advantage of a lower price, you should check the notice period and quit your current provider in time.

Good news: There is a new law in 2022 that regulates the automatic renewal period. If you sign a contract on or after 1.3.2022, you can quit your contract with a maximum notice period of 1 month (as long as you have already passed your original contract period.)

Use energy-efficient electrical appliances

When you buy a big appliance like a fridge or a washing machine, don’t just buy the cheapest one. Pay attention to the European Union energy label. This label shows you how energy-efficient an appliance is. A+++ grade is the best, meaning that it is the most energy-efficient.

You may save money now by buying the cheapest model. But you may end up paying much more on your electricity bill. Be careful not to be penny-wise, pound foolish.

Be careful of bonus

Many providers offer bonuses when you join their plans. However, the payment of the bonuses can be a bit tricky. There were many disputes between consumers and providers. Some providers refused to pay the bonus when the consumers switched their providers after the one-year contract term.

The tricky part here is the difference between delivery time (Belieferungszeit) and contract period (Vertragslaufzeit). Delivery time starts when your provider starts providing you with electricity. The contract period starts when the contract is concluded. So, the delivery time normally starts much later than when the contract starts.

Some bonuses are only given when a consumer consumes electricity from the provider for a 12-month delivery time (not the contract time!). The bonus will normally be paid out after 12 months. So, when a consumer quits his contract after the 12-month contract term, it can happen that he has not received electricity from that provider for the full 12 months yet.

What to look for if your contract includes bonuses

In this case, a consumer should find a provider with a short renewal period. For example, after the 12-month contract term, he can renew his contract just one month at a time. This allows him to still quit shortly after the 12-month delivery time. Otherwise, he will have to stick for another 12 months after contract renewal and pay a high average monthly price in the second year. Or he can quit after the first 12 months without getting the bonus.

So, before signing your contract, be sure to check the fine prints to see under what condition you will be eligible for a bonus. If you plan to stay with the same provider for 2 years, you will have to calculate the average monthly price for the first 2 years. It is because the price shown on Check24 is only for the first year when bonuses are taken into account.

Or just search for a provider that does not offer any bonuses. The price is then more transparent. You don’t have to worry about losing the bonus when you switch provider after one year.

As mentioned before, If you sign a contract on or after 1.3.2022, you can quit your contract with a maximum notice period of 1 month (after your original contract period).

Check your electricity bill

If you think your electricity bill is not correct, you should not just pay it. Instead, you should contact your provider as soon as possible. Sometimes, mistakes can happen and the provider is overcharging you for the electricity usage of your previous tenant.

This happened to a colleague of mine. In the end, he was able to lower the bill by showing a picture of his meter as proof. So, it is very important to take a picture of your meter when you move into your flat.

If you are not able to resolve the conflict after communicating with your provider, you can contact the Bundesnetzagentur for help. You can submit your complaint to them and they will provide a mediation service.

Details needed to switch your electricity provider in Germany

Switching your electricity provider is extremely easy in Germany. You can usually do everything online. The following information will be needed during the sign-up process.

• Your name 
• Your address
• Your German bank account details
• The meter number on your electricity meter
• Your estimated electric energy consumption

Your electricity meter is usually in your cellar. If you are not sure, you can ask your landlord or your apartment manager (Hausmeister).

Once you sign up, you just need to wait for the confirmation of your new contract. The new electricity provider will help to cancel your old contract.

Be careful that most electricity providers have a minimum contract period. You may have to stay with your current provider until the end of the contract period. Otherwise, you may be charged an early exit fee.

How to estimate your electric energy consumption?

If you have no clue about your electric energy consumption, you can use the below information provided by Check24 as an estimation

Note that these are just estimates based on average consumption. The consumption level can be very different depending on the individual. Below are some other ways to estimate your electric energy consumption.

1. Your electric energy consumption history

Look at your electricity bill in the past and see how much energy you have consumed. This data can help you to estimate your future electric energy need.

2. Check your electricity meter

Check your electricity meter now and in one week. The difference shows you how much electric energy you have consumed in a week. You can then calculate how much electric energy you will need for a year.

3. Electricity consumption formula

I found the below formula on the Check24 website. You can use it to calculate your electric energy consumption. Just add up the below three numbers and you can have an estimate for your yearly electricity usage.

• Square meter of your flat * 9 kWh
• Number of people in your household * 200 kWh (use 550 kWh if you use electricity for water heating)
• Number of electrical appliances (like washing machine, dryer, fridge, and TV) * 200 kWh

How much is the electricity bill?

In Germany, renewable energy producers are subsidized to make renewable energy more popular and affordable. This is done by introducing a tax on energy consumption. That is partly why electricity cost in Germany is one of the highest in Europe.

Your electricity cost will depend on where you live (postal code), the size of your apartment, and your electric energy consumption. The electricity bill usually consists of 2 components. A fixed price and a charge based on your usage. The average price for 1 kWh in Germany is around 44.17 cents in 4Q2023. To give you an example, let’s say your electricity contract has a fixed price of 10€ per month, plus 44.17 cents per kWh. If you live alone and use 1,500 kWh yearly, you will pay:

10€ per month * 12 months = 120€

1,500 kWh * 0.4417€ = 662.55€

Total electricity bill = 782.55€ per year, or 65.2€ per month

Electricity billing in Germany

When you use a new electricity provider in Germany, your first year’s bill will be calculated based on your estimated usage. It is because the new provider doesn’t have a record of how much electric energy you usually use.

After one year, they will compare your estimated usage and your actual usage. If you use more electric energy than the estimated usage, you will have to pay back the extra amount. And you will get back some money if the actual usage is less. Starting the second year, the bill will be adjusted depending on your last year’s electric energy usage. Most people choose to pay by automatic bank transfer.

Read also: Free Credit Card in Germany – Top 6 For Travel and Cashback

Take a picture of your meter when you move in

You should always take a picture of your electricity meter when you move into your new flat. You can compare the number on the meter with the one shown on your first electricity bill. This is to make sure that you are not paying for the electric energy used by the previous tenant. In case there is a conflict about the billing amount, you can also use this picture as proof.

What is an “electricity lake” (Stromsee)?

You can think of an electricity lake as a virtual lake filled with electric energy (but with no storage function). There are two sides of the lake. On one side, different electric energy suppliers filled the lake with electric energy. On the other side, people like us consume the energy from the lake.

The electricity lake consists of electric energy from different sources, including energy from fossil fuels, wind or solar power, nuclear power, etc. All kinds of energy are mixed together in this virtual lake. So, when we consume the electric energy from the lake, we always consume energy from all these sources in a mix.

What happened when you switch your electricity provider?

Let’s say you sign up with an electricity provider that only produces renewable green energy. It does not mean that the electric energy you are consuming at home is only coming from renewable green energy. It would not be possible with the electricity lake concept. In fact, nothing has changed regarding how the electricity reaches your home. You are still consuming electricity from the electricity lake, which consists of all energy sources (no matter if they are renewable or not).

That is the reason why no structural change is needed in your home when you switch your electricity provider. The electricity will come to your house like before in the same way.

What has changed is that your electricity provider is obliged to refill renewable green energy into the virtual lake. The amount it needs to refill into the lake should be equal to how much electric energy you have consumed.

So, imagine if many people sign up to use only renewable green energy, more green energy will be supplied to the lake. The electric energy mix consumed by the end customers will consist of more green energy eventually.

What are the sources of electricity in Germany?

Your electricity in Germany is coming from the below sources.

Nuclear

Nuclear power plants use nuclear fission that splits atoms. This generates heat and turns water into steam. The steam spins a turbine and produces electricity.

The use of nuclear power has been very controversial in Germany in the last decades. After the nuclear disaster happened in Fukushima, Japan in 2011, there were massive anti-nuclear protests in Germany. This leads to the decision of closing all nuclear power plants in Germany. All the nuclear power plants in Germany were closed down by 2023. The plan is to focus on renewable energy and prevent a potential nuclear accident.

Fossil fuels

The remains of organic materials like plants and animals built up in thick layers over millions of years. These layers are formed on the earth’s surface or on the ocean floors. They were buried under sand and rock. Heat and pressure changed this material into coal, oil, or natural gas.

Fossil fuel is a non-renewable energy source because it takes millions of years to form. Heat is generated by burning coals, oil, or natural gas. The heat boils water in a boiler and creates steam, which turns a turbine and generates electricity.

When coal burns, chemicals are released into the environment, causing air pollution and contributing to global warming. The global warming emissions from burning natural gas are much lower than those from burning coal.

Renewable energy

This is the energy that is renewable within a short time. For example, solar energy, wind power, hydropower, etc. Renewable energy produces electric energy without creating air pollution. Thus, they are very environmentally friendly and do not cause global warming.

If you live in Germany, you will know that environmental protection is a big topic here. Producers of renewable energy are subsidized by the German government.

What is the energy mix in Germany?

According to Destatis, 60.2% of electricity in Germany came from renewable energy sources in 3Q2023, with 24.4% coming from wind power. I am always impressed by the number of windmills I see in Germany. I have never seen anything like that in my home town Hong Kong.

Another 39.8% of electricity came from fossil fuels, and none was produced by nuclear power.

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Do you use the default electricity provider in Germany? Do you switch your electricity supplier regularly? Leave a comment below and share your experience!