April 20, 2023

A simulation of energy prices and corporate profits

High energy costs have little impact on corporate profits

Press release
Firms have absorbed the higher costs for gas and electricity with energy savings and price increases for customers. The higher energy prices are expected to lead to only a limited number of additional loss-making firms. For some firms, however, the situation can be pressing. This is the conclusion of a study published today by the CPB Netherlands Bureau for Economic Policy Analysis (CPB).
High energy costs have little impact on corporate profits

The sharp increase in energy prices in 2022 forced firms to make changes. The manufacturing industry managed to reduce natural gas consumption by 40%. In addition, output prices have risen in almost all industries – in some even more than the prices of inputs have risen.

Firms are relatively insensitive to energy prices

With a stress test, the CPB calculates that the number of firms that may suffer losses due to higher energy prices is limited. In the most likely scenario in which firms adjust energy consumption and output prices, the share of loss-making firms increases by 2 percentage points (3,700 firms with 1 or more employees). In an alternative scenario where firms neither reduce their energy consumption nor increase their output prices, this increases to a maximum of 4 percentage points (7,500 firms). Under normal circumstances, about 20% of firms make a loss.

This stress test does not provide a forecast of the actual number of firms that have become loss-making due to the energy crisis. This also depends, for example, on individual characteristics of the company, such as the specific energy contract, as well as on the consumption of other inputs whose price may have risen as a result of higher energy prices. These factors have not been included in the stress test. Although the consequences for all firms are limited, the situation can be pressing for some firms.

Big differences between industries

The scenarios do show major differences between industries. In the production of cement and glass, in the wellness and funeral industry, the number of firms that are vulnerable to higher energy prices is relatively large. This is mainly because energy consumption in these industries was already relatively high.


In the original publication of 20 April 2023, the method description in section 6.1.3 contained some inaccuracies. These have been corrected in the current version (June 16, 2023). The rest of the publication, including all research results, remains unchanged. The original publication is also included as a download.

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