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Electric shock: Why Spanish households will face higher electricity bills in 2025
The average electricity bill in Spain will increase by between 106 and 118 euros next year
Spanish households are in for a shock as electricity bills are set to rise significantly next year. According to the Organisation of Consumers and Users (OCU), upcoming tax and regulatory changes announced by the Government will push up the average household's annual electricity costs by as much as 13%.
For a household with 4.6 kW contracted and an annual consumption of 3,500 kWh, this translates to an extra 118 euros for those on free-market tariffs and 106 euros for those on the regulated PVPC tariff. Here's a closer look at why your energy bill is about to climb.
What’s driving the spike in your electricity costs?
Despite a modest reduction in tolls - the fees charged for delivering electricity to homes - amounting to just 1 euro less per year, several other factors are working against consumers. The OCU points to three major drivers of the hike:
1. System charges: Up by 33%
The Ministry for Ecological Transition has proposed a sharp 33% increase in system charges, adding 22.30 euros per year to the average household’s bill. While these charges are still below the levels suggested in mid-2021 before the Ukraine war disrupted the electricity market, they remain a significant burden.
2. Cost of financing the social bonus
The social bonus, a subsidy aimed at helping vulnerable and low-income consumers, is also pushing bills higher. For those on free-market tariffs, this charge, which is passed on by most electricity providers, will rise from 19 cents to 32 cents per month next year, adding about 1.50 euros annually.
For regulated PVPC tariff customers, there’s a slight silver lining: a saving of 8.60 euros per year as they align with free-market rates. This change comes after months when PVPC users were paying more to cover the cost of reference marketers unable to pass on rising expenses.
3. Return of the 21% VAT rate
The VAT on electricity, temporarily reduced to 10% to mitigate soaring prices during the energy crisis, is reverting to its original 21% rate. This rollback will hit households hardest, erasing much of the previous relief.
What does this mean for your wallet?
When all is said and done, the average monthly electricity bill for households on the regulated PVPC tariff will climb from 74.60 euros to 83.60 euros, resulting in an additional 106 euros per year. For those on free-market tariffs, the increase is slightly steeper at 13.4%, or 118 euros annually.
In response to these changes, the OCU is doubling down on its demand for electricity to be recognised as a basic necessity. The organisation argues that VAT on electricity should be permanently capped at 10%, regardless of market fluctuations. This call to action is part of a broader campaign to overhaul the electricity market, which the OCU has been pushing since 2021.
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