While natural gas supplier Eesti Gaas has been offering the option of a fixed-price package to domestic consumers for some time, it has not publicly advertised this on its website, and in fact has stated that a 12- or 24-month fixed price package is currently unavailable.
Eesti Gaas board member Raul Kotov told ERR that: "The information has not been up [on the site] as recent experience has shown that when customers have signed up for a fixed package, they have not fully realized that if they then want to terminate the package early, an early termination fee is due."
"We had wanted our customer managers and customer service representatives to be able to clarify this [to consumers]," he added.
Fixed package customers have wanted to terminate early following the fall in natural gas prices on the Netherlands-based Title Transfer Facility (TTF) in recent weeks, he added.
Since the TTF price is likely to fall further, Kotov went on, there is no real reason for customers to want to fix prices at this time, while the risks associated with a fixed package should be talked through between customer and customer relations manager.
Eesti Gaas had earlier halted its fixed-gas packages in September at a time of soaring (€300 per MWh or higher) TTF prices, and offered an exchange-based deal, or a flexible package (see diagram below). Much has changed since then, however, when the price halved by mid-December 2022, halving once again between then and year-end.
"At a time when the price on the [TTF] Dutch stock exchange stands at €70 [per megawatt-hour], I would venture to say that it could drop further from €1.25 [per cubic meter, the price to domestic customers Eesti Gaas is offering from next month]."
"By how much, however, I cannot say more precisely at the moment," he added.
As of Thursday morning, natural gas futures were trading at €67 per MWh on the TTF.
Eesti Gaas informs its customers of price changes one month in advance, meaning the recent drop would not be reflected in customer bills until February in any case – ie. when the price to householder drops from its current level of €1.75 per cubic meter, to €1.25 per cubic meter.
In any case, domestic consumers can also obtain a fixed price package of €1.25 per cubic meter, inclusive of VAT, for a one-year term, Kotov added.
The graphs below, taken from Eesti Gaas' website, show the packages offered to domestic consumers as of the time of writing.
The current TTF price is also significant in that it is below the €80-per-MWh threshold the Estonian state put in place for energy support measures, rolled out at the start of autumn.
The state pays 80 percent of that component of a domestic natural gas bill which exceeds €80 per MWh in price, with a consumption cap placed based on the average household gas usage. Customers can consume more natural gas than that figure, simply that compensation will not apply to that excess.
With the price below €80 per MWh at present, that compensation will no longer apply, for as long as it stays below the threshold.
The compensation measure, along with similar measures put in place for electricity and district heating, runs to the end of March, traditionally, and as often as not, in actuality, the end of heating season in Estonia.
Factors behind the fall in international gas prices include the unusually mild winter, if viewed on a Europe-wide basis, and the fact that fears of potential gas shortages resulting from the need to decouple from Russian supplies have not materialized.
Editor: Andrew Whyte, Barbara Oja