Fraunhofer Institute for Systems and Innovation Research ISI
Fraunhofer Institute for Systems and Innovation Research ISI

Project

Analysis of energy prices and costs in the EU, its Member States and major trading partners (EnPriC)

The study explains the evolution, composition and drivers of electricity, natural gas and petroleum product wholesale and retail prices, for the EU Member States and major trading partners of the EU. Furthermore, industrial energy costs and their impacts on industrial competitiveness are analysed.

Finally, the study shows the evolution of household energy expenditures, their main drivers and their social implications.

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To gain insight into

  • The development of electricity, natural gas and petroleum product wholesale and retail prices of EU Member States and major trading partners
  • The composition of retail prices
  • The main drivers of wholesale and retail prices
  • The impact of energy policies on retail prices

To achieve these objectives, the team builds upon existing data, data provided by the European Commission and own data search and compilation. This requires intensive research on national prices and price components, such as the energy supply component, grid fees, diverse taxes and levies. However, to get the retail price components for different consumer groups detailed inquiries of policies, regulations and directives regarding exemptions of large consumers from some retail price components is required. Econometric analyses are applied to identify  drivers of energy prices and assess their impact. To demonstrate how energy prices affect industrial competitiveness, electricity costs per unit of product produced will be depicted under different power prices and compared to the product’s market price (see Figure 1). Finally, to decompose energy expenditure growth in households into its different drivers an additive LMDI (logarithmic mean Divisia index) decomposition will be applied.

Figure 1

  1. Assessment of the evolution, composition and drivers of energy prices in the EU
  2. Assessment of the evolution, composition and drivers of energy prices in major EU trading partners
  3. Analysis of energy costs for industry in the EU and major trading partners
  4. Analysis of household energy expenditure in the EU

Figure 2

Publications

  • Presentations (not yet available)

Duration

September 2015 - April 2016

Client

DG Ener of European Commission

Project team

  • Fraunhofer ISI
  • Ecofys (coordinator)
  • CASE