In the Speed Queen laundry, located in the center of Madrid, they have a panic over the price of electricity. Since at the beginning of this year energy began to become more expensive, and then in June the changes in the bill with the famous peak and peak hours came into effect, Yenobis Mundaray, one of the owners of this family business, decided to start ironing first hour, before opening the premises. She was also forced to turn off the air conditioning that was indispensable in previous summers. And so it continues three months later. “It’s horrible because of the heat that the iron gives off, in addition to ironing all the garments at once before 10 in the morning [cuando empieza la hora punta] it destroys your hands, ”explains this 46-year-old Venezuelan.
The price of electricity in the wholesale market was the most expensive in history in June, a record that was broken in July and could be exceeded in August. Meanwhile, consumers who have contracted the regulated rate (PVPC) or other rates indexed to the wholesale market helplessly watch their bill skyrocket, both families and companies. Small establishments are especially punished by the few resources they have to face a rise in costs after a year of pandemic, as Lorenzo Amor, president of the Association of Self-Employed, explains: “It comes at a time when many businesses are beginning to waking up, and of course the rising cost of the light does not help ”. The employer estimates that the bill has risen on average these months by 35% in small businesses.
María Fernández, owner of the Lavapiés Pharmacy, also in the center of the capital, used to pay around 600 euros for electricity at this time, but in July the amount soared 200 euros more. “This affects everyone’s economy. If you consider hiring someone or raising the salary of your employees, this makes you think twice, “he says. In his case, it is impossible to reduce the consumption of electricity to soften the bill because he needs to have the refrigerators on 24 hours a day to keep the medicines.
Moreover, expenses in Marta García’s restaurants have rampaged, who has seen how the energy bill of her Portomarín and La Caníbal stores, both in Lavapiés, rose by about 50%. “Between the two of them they add 2,000 extra euros just in July,” says the businesswoman, who also feels powerless because she cannot reduce her electricity bill or raise the price of the menu to offset the bill due to the enormous competition that exists in the hospitality industry. . “It is an increase in spending that we have to assume for our benefit,” he sums up.
Emilio Gallego, Secretary General of Hospitality of Spain, insists on how worrisome this increase in costs is for the sector. And remember that it not only occurs in the price of electricity, but also in food and beverages. If the former have become more expensive for the final consumer by around 2% since last year, water and soft drinks have done so by 6.9%, according to the Consumer Price Index (CPI) of the INE. Industrial prices in the food sector have grown by 8.1% since July 2020.
Regarding the electricity bill, Gallego emphasizes that the hotel industry and shops are fully affected by the new bill, since during off-peak hours (when energy is cheaper), the premises are closed. “It is an impact at a time of strong competition and with a demand that is not stabilized by the pandemic. Without a doubt, it is a stone on the road to recovery, ”says the employer’s representative.
The price of gasoline at its highest in seven years
Added to the rising cost of electricity is the price of fuel, which has risen for nine months. Since November, the cost of fuel has increased by 25% and this week a liter of gasoline stands at 1.42 euros on average – a record in seven years – and diesel at 1.27 euros. “These prices are a drag on the taxi sector,” emphasizes Lorenzo Amor, representative of the self-employed.
Refilling a 50-liter tank of gasoline now costs about 70 euros, while a diesel tank exceeds 60 euros. They are about 10 euros more than in January, which is part of the profits of taxi drivers, who have regulated rates that cannot be increased to compensate for expenses. “The CPI for personal transport has risen more than 8% so far this year and until the rates are updated in December we will not be able to pass the increase on to users,” explains Jesús Fernández, vice president of the Professional Taxi Federation. of Madrid, which foresees that the races will be more expensive next year.