Energy prices could climb again if winter is cold, power company warns

While energy costs are currently lower than last autumn, a harsh winter could see them rise again. This concern was raised by E.ON, the German power company behind Essent and Energiedirect, Nu.nl reported on Wednesday. "The energy crisis is not quite over," said CEO Leonhard Birnbaum.

During the company’s mid-year report, Birnbaum highlighted that the wholesale prices of gas and electricity are currently much lower than the previous year. This has been advantageous for E.ON, with its profits jumping from 4.1 billion euros in the first half of 2022 to 5.7 billion euros during the same period this year.

Birnbaum said he believes these reduced energy prices could result in significant savings for many customers. However, he advised both consumers and enterprises to continue practicing energy conservation.

While the energy crisis seems to have eased somewhat, Birnbaum suggested that it has not ended yet. Energy prices may experience a sharp increase if there is a rapid depletion of gas reserves, particularly if this coincides with a colder-than-expected winter.

A report from the International Energy Agency last month hinted at potential market volatility, especially if there is a colder winter. This risk is heightened if Russian gas deliveries to Europe are halted early into the heating season.