The Government maintains that it will fulfill its promise by including homes with free rates, as they also benefit from the reduction in taxes and charges
There is one month left until the deadline announced by the President of the Government, Pedro Sánchez, expires to fulfill his promise that the average electricity bill for this year will be similar to that of 2018, discounting inflation. For now, in the case of households that have contracted the regulated rate (PVPC), they are paying an average of 123 euros more on their bills than what they paid three years ago during the first 11 months of the year. That is, about 10 euros more per month.
The amount of these receipts linked to the regulated tariff has been increasing in recent months as a consequence of the rise in the cost of generation, which is calculated daily in the pool. After the October records, in November that price has remained above 200 euros / MWh for almost the entire second fortnight. And this evolution has been felt in the receipt of the PVPC despite the fact that the measures adopted by the Ministry of Ecological Transition are in force to cushion the price crisis: VAT reduction from 23% to 10%; reduction of the special Electricity Tax from 5.1% to 0.5%; and suspension of charges up to 96%.
The calculations made by this newspaper, with data from the price simulator of the National Markets and Competition Commission (CNMC), reveal that for an average household with a regulated tariff (3,400 kWh of consumption per year and power of 4.4 kw), the 10.5 million households benefiting from this modality have paid 838 euros in electricity bills between January and November. That amount is higher, by 123 euros, than the 715 euros they paid in that period and under the same consumption and power conditions three years ago.
Monthly amount of a receipt
average PVPC *, in euros
201820212021
with social bonus **
* Annual consumption of 3400 kwh and power of 4.4kw. From 06-01-2021, consumption time sections (30% valley, 30% flat and 40% peak) and two power time sections.
** Social bonus for vulnerable families with two dependent minors.
Source: Data prepared with the CNMC simulator.
Monthly amount of a receipt
average PVPC *, in euros
201820212021
with bonus
Social**
* Annual consumption of 3400 kwh and power of 4.4kw. From 06-01-2021, consumption time sections (30% valley, 30% flat and 40% peak) and two power time sections.
** Social bonus for vulnerable families with two dependent minors.
Source: Data prepared with the CNMC simulator.
Monthly amount of an average PVPC receipt *, in euros
* Annual consumption of 3400 kwh and power of 4.4kw. From 06-01-2021, consumption time sections (30% valley, 30% flat and 40% peak) and two power time sections.
** Social bonus for vulnerable families with two dependent minors.
Source: Data prepared with the CNMC simulator.
No matter how much the cost of electricity generation fell during December, this year’s regulated bill will end up being higher than three years ago. Because the difference of those more than 120 euros accumulated so far would not be compensated with a drastic cut in the pool. If it fell a lot – a circumstance that futures rule out -, the difference would be slightly less than those 10 euros.
This cost would have been higher if the record price at which wholesale electricity is still installed is taken into account (at some point close to 300 euros / MWh) caused by the rise in the cost of gas in international markets. In addition, since June, the receipts of domestic users have been cushioned both by the extension of the social bonus for vulnerable groups, as well as by the tax cut and the reduction of the fixed part; These last two decisions have been noted on the receipts of all households.
That is the explanation that the Government clings to to indicate that it will fulfill the promise made by Pedro Sánchez in September, in a television interview, in the midst of the energy crisis. The statistics taken by the Executive to explain this evolution of electricity include not only what households have paid with a regulated rate, but also the 16.2 million families that have contracted free rates, according to the CNMC.
By incorporating these households with fixed contracts (usually monthly or annual) into the equation, the average amount of the receipts can be similar to the invoices that were paid three years ago, counting both the regulated and the free ones.
Eurostat data add up
The economic vice president, Nadia Calviño, insisted this Wednesday in Congress that the Government is fulfilling its commitment to pay for electricity “more or less” what was paid in 2018 and has pointed out that, with regard to this Subject, the problem must be tackled “from the source.”
For her part, the Secretary of State for Energy, Sara Aagesen, recently clarified that what was promised will be fulfilled, “taking as a reference the retail prices of the free market and the PVPC that the traders periodically send to Eurostat so that it can draw up the official statistics of the EU”.
The latest records from the European office reveal that households paid an average of 0.135 euros / kwh during the first half of this year.
In 2018, this cost was around 0.19 euros / kwh (0.187 euros / kwh in the first half and 0.194 euros / kwh in the second). With these references, even if this indicator rises in the second tranche of this year (the final amount is published in 2022), the average for 2021 would be similar to that of three years ago.
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