- The financial strain of energy expenses disproportionately impacts East German households.
Eastern German households struggle more with energy expenses, as per analysis from comparison site Verivox. After accounting for income disparities, costs for heating, electricity, and fuel stand at about 22% more than in the west. The hardest hit areas are Thuringia and the easiest is Bavaria.
Lower earnings impact the east
An average German household with approximately 2.03 inhabitants currently shells out 4,297 euros annually on energy, as per Verivox. In western states, the average household spends 4,280 euros, while in eastern states, it's 100 euros more expensive but significantly greater.
However, the disparity escalates when income is taken into account. After adjusting for purchasing power, annual energy expenses amount to 4,139 euros in the west and 5,042 euros in the east – a difference of over one-fifth. Households in Thuringia lead the pack, with costs 23% above the national average, followed by Bremen and Saxony at 20% more, Saxony-Anhalt at 19%, and Mecklenburg-Vorpommern at 18%.
Households in Bavaria or Baden-Württemberg face lesser expenses
Verivox observes that the least energy expense burden is in prosperous Bavaria, which is 10% below the national average. Baden-Württemberg is 8% below, and Hesse is 5% below.
The average household income in western Germany stands at 58,333 euros, contrasting with 48,977 euros in eastern Germany – approximately 16% less.
At the same time, higher tariffs are being charged for the same amount of energy in the east. Although there's no significant difference in fuel rates, electricity and heat cost a few percent more.
As Thorsten Storck of Verivox put it, "Households in the old federal states spend around 7% of their purchasing power on electricity, heat, and fuel, while those in the new federal states spend around 9%." The energy price discrepancy between east and west can be partially attributed to network charges. The expenses related to operating, maintaining, and expanding the electricity grid are around 3% higher in eastern Germany for electricity and around 10% higher for gas.
Despite the higher energy expenses, households in 'The comparison portal' [Verivox] found that Bavaria and Baden-Württemberg have lower energy burden compared to the national average. Conversely, households in Thuringia and other eastern states like Bremen, Saxony, Saxony-Anhalt, and Mecklenburg-Vorpommern face higher energy costs relative to their income, as per the analysis by 'The comparison portal'.
