A new rule came into force in Germany on January 1, 2024: all energy supply companies are required to offer customers dynamic electricity tariffs. This means that the price per kilowatt-hour can now change every 15 minutes or even in real time, depending on the situation on the wholesale market.

The recent case of negative retail prices for electricity on Sunday clearly showed how this system works – and what opportunities and risks it brings for consumers.

Dynamic tariffs: the essence of the innovation

Flexible price – the cost of electricity is tied to stock exchange quotations (EPEX Spot, Nord Pool, etc.). The condition for connection is the presence of a smart meter.

The main beneficiaries are households with:

• Electric vehicles
• Heat pumps
• Home batteries

This model allows you to save by consuming energy during the hours of its lowest cost, and even earn money if the price goes into the negative.

Sunday phenomenon: electricity is cheaper than zero

On one of the weekends (the exact date is not specified), retail prices for electricity in Germany fell below zero – after taxes and fees (~18 cents / kWh).

Key figures:

• Minimum retail price: -8.6 cents / kWh (supplier Tibber, period 13:00 – 14:00).
• Wholesale price at the same time: -25.03 cents / kWh (-250.32 € / MWh).
• In some regions, the price reached -12 cents / kWh.

Why did this happen?

1. Record generation from renewable energy sources – high performance from solar and wind power plants at the same time.
2. Low demand – day off, industry consumes less.
3. Inflexibility of traditional generation – nuclear and coal plants cannot quickly reduce output, so they are forced to pay for the energy shipment.

The flip side: a sharp price jump in the evening

Dynamic tariffs are not only an opportunity to save, but also a risk. Already on the same day:

• From 20:00 to 21:00, the price soared to 36 cents / kWh.
• This demonstrates high volatility and the need for flexible consumption management.

How often are there negative prices in Germany?

According to data for 2024:

• 457 hours out of 8784 (5.2% of the time) wholesale prices were negative.
• However, before the introduction of dynamic tariffs, consumers did not feel this benefit – distribution companies worked at fixed rates.

Global context: who was the first to introduce dynamic tariffs?

• Pioneers – Great Britain (late 2010s).
• Now Germany is actively picking up this trend.

What does this mean for consumers?

Pros:

• The ability to pay less or even receive money for consumption.
• Incentive for the development of “smart” energy systems (batteries, automation).

Risks:

• Unpredictability – prices can rise sharply.
• Need for technology – without smart meters and control systems, the benefit is minimal.

The future of the energy market

• Growing demand for home storage devices and smart control systems.
• Possible spread of dynamic tariffs in other EU countries.
• Acceleration of the abandonment of inflexible generation (coal, nuclear power plants) in favor of renewable energy sources and gas peak stations.

Conclusion

The German experiment with dynamic tariffs shows how green energy is changing the rules of the game. Consumers can now influence their costs, but they will have to adapt to high volatility. In the coming years, this trend is likely to spread across Europe.