Belgium Energy Shift: Cheaper Electricity, Costlier Gas and Fuel by 2028

Belgian households are facing a two-pronged energy transformation. The Flemish government has announced a major tax shift from 2028 that will make electricity cheaper while raising the cost of gas and heating oil, and fuel prices at the pump are climbing sharply across the country due to surging global refining margins. Together, these developments signal a fundamental reshaping of Belgium’s energy landscape.

The Flemish Tax Shift: What Is Changing?

On July 10, the Flemish government formally decided to implement a tax shift starting in January 2028, moving a total of €317 million in levies from electricity bills to gas and heating oil bills. An additional €173 million will be removed from electricity bills without being shifted elsewhere, according to VRT NWS.

For a typical family heating with gas, the result is a net-neutral effect: electricity costs drop by €80 per year, while gas costs rise by the same amount. Apartment dwellers stand to benefit slightly, with gas rising €38 and electricity falling €57, yielding net savings of about €19 annually. Households using heating oil will see their bills increase by €56 per year, while those with heat pumps will benefit significantly.

“A standard family will pay 80 euros less per year for electricity, and at the same time 80 euros more for gas,” Anne Vanrenterghem of VRT NWS reported.

Small businesses will see gas costs rise by €88 and electricity drop by €100. Medium-sized enterprises face a starker shift: gas up by nearly €5,000 and electricity down by €9,500. Large industrial gas users with furnaces exceeding 1,000°C — such as steelmaker ArcelorMittal in Ghent — are exempted from the tax shift.

Flemish Energy Minister Melissa Depraetere (Vooruit) said the government had removed from electricity bills everything legally possible, though some charges, including green certificate costs, will remain.

Why This Shift?

The tax shift is a deliberate climate policy tool. By making electricity cheaper and fossil fuels more expensive, the Flemish government aims to incentivize households to switch from gas and oil heating to electric alternatives such as heat pumps and induction cooking. The policy aligns with Flanders’ target of reducing CO₂ emissions by 40 percent by 2030.

Originally planned for 2027, the shift was delayed by one year after the European Union postponed its ETS2 carbon tax system, which will put a price on CO₂ emissions from fossil fuels used in heating and transport. Federal excise duties on fossil fuel heating are also scheduled to increase from August 1, 2026.

About 30 percent of Flemish residents may end up paying more for energy, while 70 percent will see no negative impact or will benefit, according to the government’s calculations.

Fuel Prices Surge at the Pump

Separately, Belgian motorists are feeling the pinch as fuel prices rise sharply. As of July 10, the maximum price for diesel B7 reached €2.102 per liter — an increase of 13.5 cents — while gasoline 95 RON E10 climbed to €1.909 per liter, up 5.9 cents, as reported by RTBF.

The driving force behind these increases is not crude oil prices alone, but soaring refining margins. According to Goldman Sachs, refining margins are running at two to three times the 2013–2019 averages and are expected to remain elevated through 2026, with diesel margins forecast at $50 per barrel in the U.S. and $37 per barrel in Europe for the fourth quarter.

“Refining margins are today as important a lever as the price of a barrel for understanding oil profits — and prices at the pump,” wrote Michel Gassée of RTBF.

Geopolitical and Structural Factors

Several factors are driving the refining margin surge. Ukraine has targeted 25 Russian refineries since January 2026, hitting 82 percent of the country’s capacity, with 16 facilities struck at least twice. This has forced Russia to impose a temporary ban on diesel exports to address domestic shortages.

Meanwhile, European refining capacity has shrunk over the past decade as plants have closed. Belgium now has only two refineries remaining — TotalEnergies and ExxonMobil, both in Antwerp — after Gunvor shut down its operations. The industry federation Energia no longer publishes refining margin data, citing competition concerns with only two players left.

“For about ten years, several European refineries have closed, reducing the continent’s production capacity,” noted Théo Le Chanu, an analyst cited by RTBF.

What This Means for Belgian Households

The two stories are interconnected facets of Belgium’s broader energy transition. The Flemish tax shift addresses heating costs, while the fuel price story affects transportation. Both are influenced by EU climate policy and global geopolitical tensions, and both weigh on household budgets amid ongoing cost-of-living concerns.

In the short term, Belgian households face rising costs at the pump and, from August 2026, higher federal excise duties on heating fuels. From 2028, the Flemish tax shift will create clearer price signals favoring electrification, though the transition may prove challenging for the 30 percent of households expected to face higher overall energy costs.

Looking ahead, the EU’s ETS2 carbon tax will add further costs to fossil fuel use, while Belgium’s remaining refineries remain vulnerable to global shocks. The coming years will test whether fiscal policy and market forces can together accelerate the shift away from fossil fuels without leaving vulnerable households behind.