Energy prices set to drop by 10% next year, says minister

Electricity prices are expected to fall by around 10% next year for the average household in Luxembourg, Energy Minister Lex Delles has said, although prices remain above levels seen at the start of the decade.

The average household, defined as one with annual consumption of around 3,900 kilowatt-hours, should see its yearly bill cut from €1,115 in 2025 to €1,006 in 2026, according to Delles, who appeared before a closed-doors meeting of parliament’s energy committee on Tuesday.

Delles was quizzed on the government’s €150 million scheme to subsidise the expansion of the Grand Duchy’s electricity grid, which was announced by Prime Minister Luc Frieden during his state of the nation address and approved by the cabinet in July. 

In addition to the grid subsidy, customers will also be able to benefit from another aid scheme, called the mécanisme de compensation (compensation mechanism), will continue from this year, with the state contributing around €80 million in 2026, according to a report of the committee meeting published on parliament’s website.

However, between 2021 and 2024, the price for the same household used in the example given by Delles was around €850 a year with previous government subsidies.

The financial support set to be introduced from January will be transferred directly to the electricity network manager, Creos, and will be reflected in the bill without the customer seeing the share of the aid explicitly. This alleged lack of transparency was criticised by some deputes, who argued that the impact of the aid should be more visible to the consumer.

The new grid subsidy will replace the Energiepräisdeckel, a government subsidy that froze electricity prices during the peak of the energy crisis, which expires at the end of this month after a phase of progressive reduction. This year alone, this mechanism accounted for around €170 million in state support.

The price drop is not just the result of state intervention. The market price of electricity itself is expected to fall by around 15% in 2026, also contributing to the reduction in the final bill. Last week, energy provider Enovos announced it would cut prices by around 16% from January.

As for Luxembourg’s position in the European context, the meeting heard, data presented shows that in the second half of 2025, only France had lower electricity prices for residential consumers.

Work on the draft bill is progressing, Delles told the committee. The debate and final vote in plenary session are scheduled before Christmas, allowing the new mechanism to come into force in time to influence 2026 bills.

(This article was published by Contacto. Machine translated, with editing and adaptation by Alex Stevensson.)