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Cost of living For Members

Cost of living: How expensive is Denmark today compared to 2021 and 2022?

Michael Barrett
Michael Barrett - [email protected]
Cost of living: How expensive is Denmark today compared to 2021 and 2022?
How do current prices in Denmark compare to 2022 and 2021? Photo: Signe Goldmann/Ritzau Scanpix

Those living in Denmark have no doubt noticed that inflation took off last year but has since settled. How much more expensive has life in Denmark become?

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July saw inflation up in Denmark for the first time since October 2022, increasing from 2.5 percent in June to 3.1 percent in July.

This might not be as concerning as it sounds – the higher estimate for inflation can be partly explained by the return of an electricity tax in July, which increases the cost of energy for consumers.

It should be kept in mind that inflation of 3.1 percent is still far lower than the 10 percent rate which was reached in October last year, as the knock on impacts of high energy prices and the war in Ukraine were felt across the economy.

Inflation meant that the price of fuel, energy and food all went up in 2022. Supermarkets have only recently begun to announce that they are beginning to cut the prices of some items again.

READ ALSO: Supermarket cuts prices of 150 products in Denmark

So how do current prices shape up compared to a year ago, and in 2021 before inflation took hold?

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How much does fuel cost?

For those using petrol, specifically Benzin 95 (unleaded petrol), the price per litre on August 14th is 15.69 kroner, compared to 16.29 kroner per litre a year ago according to fuel company OK. On the same date in 2021, the per-litre price was 13.19 kroner and on January 1st it was a comparative bargain at 11.24 kroner per litre, around two-thirds of the current price.

The lowest price for petrol so far this year occurred on July 1st, when it was 14.59 kroner per litre.

For diesel, today’s price is 14.29 kroner per litre. The 2022 equivalent is 15.99 kroner per litre. On August 14th 2021, you would have paid 11.29 kroner for a litre of diesel.

HVO Biodiesel, a renewable alternative to diesel, costs 28 kroner per litre today compared to 29.61 kroner and 19.39 kroner in 2022 and 2021 respectively.

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What about energy prices?

Energy prices are in general lower in summer than winter, especially given the wet and dreary summer Denmark has had, which has been good news for the country’s wind power production as well as hydropower, which can be sourced from neighbouring Sweden and Norway.

Having said that, the cost of electricity went up significantly in July. This is because electricity tax was temporarily cut by the government to the lowest level permissible in the EU, as a measure to help reduce energy costs in response to the spiralling prices in 2022.

The temporary measure expired at the end of June and wasn’t extended, which meant that tax added to electricity bills went from 0.8 øre per kilowatt hour in June to 68.8 øre per kilowatt hour in July.

Setting aside the tax, the kilowatt hour price of electricity is down a lot compared to last year. Figures from tracking website elberegner show that the price in July was around 0.49 kroner per kilowatt hour. In August 2022, the month the energy crisis saw prices hit their highest point, the unit price was as much as 3.4 kroner per kilowatt hour.

In August 2022, electricity was priced at 0.62 kroner per kilowatt hour – more expensive than it is today.

The price of gas was one of the biggest talking points during the energy crisis because of the amount by which the cist for consumers shot up. The government introduced special cash assistance for homes that were primarily gas heated and announced it would speed up work to move homes onto district heating networks, future proofing against continued high price gas prices.

READ ALSO: How to reduce your Danish heating bill in the summer

Data from OK show that natural gas cost 4.34 kroner per cubic metre last month, the most recent figure available. In August 2022, the price was an eye-watering 27.15 kroner per cubic metre. The August 2021 price is listed at 5.43 kroner per cubic metre, lower than today’s price.

The return of prices to more normal levels will be a relief to people who live in homes heated by gas. Real estate media Boligsiden used data from energy customers to estimate additional costs from the inflated gas prices of last year to run into tens of thousands of kroner.

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How much have food prices gone up?

It's difficult to say in kroner how much food prices have increased, as your food shop depends so much on the exact products you usually buy and some supermarket chains introduced schemes whereby the prices of select goods were frozen during the initial months of inflation in 2022.

Last month, a survey conducted by Statistics Denmark found that 54 percent of food, drink and tobacco retail businesses said they expect prices to fall during the next three months.

That is more than the preceding survey in June, when 45 percent had the same expectations. As recently as April, nearly two-thirds – 63 percent – of companies expected prices to increase in the intermediate future. That figure is as low as 3 percent in the latest survey.

A number of supermarkets have since confirmed upcoming price cuts or reductions that have already taken effect, often citing reduced costs with suppliers that are passed on to customers. These supplier costs have a transport – and therefore a fuel – element.

Food prices may now be showing signs of falling from their current levels, they are still higher than they were in 2022 because inflation, although lower, is still above zero and thereby pushing prices up.

According to broadcaster DR, a shopping basket containing 18 everyday food products such as a cucumber, chips, ketchup, butter, sugar, rye bread, coffee, milk and cheese would set you back 424 kroner today, compared with 404 kroner a year ago. But the same basket would have cost as much as 448 kroner in January this year.

In March 2022, the Confederation of Danish Industry (DI) said that food prices were 5.8 percent higher overall than in February 2021.

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So, how much more expensive is it to live in Denmark than it was a year ago?

The best way to look at this is by using the figures for inflation, collected by Statistics Denmark. The agency regularly updates its standard measure for inflation, measuring the average change in prices paid by consumers compared to a year ago.

July’s inflation figure of 3.1 percent means prices for consumers are up by 3.1 percent on average compared to a year ago. This takes in a range of categories including fuel, food, energy, leisure, hospitality, clothing, communication, transport and so on.

Core inflation, which does not account for energy and food prices and thereby can be used as a measure for the spread of inflation through other parts of the economy, was found to be 5.3 percent in July, 0.4 percent higher than it was in June.

 

 

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