Energy transition: Still little momentum for dynamic electricity tariffs

Since the beginning of 2025, energy suppliers in Germany have been obliged to offer customers dynamic electricity tariffs. At least to the extent that this is "technically feasible and economically reasonable". The fact that this legal requirement would be introduced has been known in principle since the amendment to the Energy Industry Act was launched in summer 2021. The Swiss startup Exnaton, which offers an AI-based billing platform, is now complaining that little has been done about this. According to Exnaton, large energy suppliers in particular only began to seriously consider implementation in the summer of 2024. The result? "Many providers were unable to meet the deadline and are still without viable solutions after the deadline."

In May 2023, the Federal Council finally approved the law initiated by the Federal Ministry for Economic Affairs and Climate Protection (BMWK) to restart the digitalization of the energy transition. The main aim is to accelerate the installation of smart meters across Germany. By 2032, such intelligent electricity meters are to be used in households and businesses across the country. According to the law, all electricity suppliers must also offer dynamic tariffs from three weeks ago. This should enable customers to shift their electricity consumption to more cost-effective times with high generation.

According to the plan, a smart meter will enable consumers to analyze their own consumption patterns. In the next step, this should make it easier for them to find a tariff that suits their electricity usage. The BMWK is confident: "Ultimately, this will save a considerable amount of money."

Extensive system conversion necessary

Experts have long considered a flexible energy market with options for citizens and companies to feed unlimited electricity from photovoltaic and wind power plants into the grid to be an important building block in the restructuring of the grid. They also see dynamic tariffs coupled with intelligent electricity meters, virtual power plants and battery pooling via electric vehicles and smart grids as important drivers.

Nevertheless, little has happened among industry giants. "The apparent reasons for this are manifold," explains Exnaton CEO Liliane Ableitner. They range from "challenges in technical implementation and strategic hurdles to the lack of infrastructure – keyword smart meter rollout." It is clear that the introduction of flexible tariffs to meet the legal requirements "requires far-reaching adjustments to the processes and structures of energy suppliers". Above all, however, their "hesitant action" casts "a critical light on the priorities set by the industry".

While conventional tariffs only multiply a fixed price by the total consumption of the year, dynamic tariffs require "a fine-grained recording of consumption at 15-minute intervals", explains Ableitner. "This means that instead of a single annual reading of the electricity meter, each household has around 35,000 consumption data points per year that need to be recorded and billed." This is "a huge technical change" that existing enterprise resource planning (ERP) systems cannot cope with. Some ERP providers even advise energy suppliers to "classify time-based tariffs as economically unreasonable". This nips innovation in the bud.

New providers tend to offer variable tariffs

In addition, "transparent, intuitive and user-friendly visualizations, real-time notifications and integration with electricity devices play a key role in the acceptance of and trust in dynamic tariffs," says Ableitner. Without targeted educational work, the concept remains difficult to access and the willingness to use it remains low. The lack of smart meters, on the other hand, does not prevent transitional solutions via standard load profiles (SLP). Newcomers such as Tibber, 1Komma5, Enpal, Octopus, Rabot Energy and Sonnen showed how alternative solutions could be implemented.

A study accompanying the BMWK's Elektro-Mobil funding program in 2021 showed that dynamic tariffs can encourage e-car drivers to charge at low-consumption times or give them the freedom to refuel at peak times with full power – but at a higher price –. Example: As part of the initiative, Berliner Stadtreinigung (BSR) has networked its electric commercial vehicles at five locations and connected the charging technology to the power grid in such a way that possible charging periods are automatically transmitted to the electricity supplier. This then reports back the most cost-effective charging times based on electricity market forecasts. In this way, BSR – was able to prevent grid overload without restricting the readiness of its increasingly electrified fleet – and at the same time reduce procurement costs per kilowatt hour by around 16 percent.

(nen)