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Date Published: 03/08/2021
ARCHIVED - Electricity prices in Spain are 36 per cent higher in July than a year ago
Electricity costs rose by 36.2 per cent in July, almost €23 euro more than a year ago
The upward trend in electricity prices in Spain shows no signs in slowing down as the cost to the consumer has risen yet again in July, according to an analysis carried out by Facua-Consumidores en Acción. The latest data shows that the PVPC semi-regulated rate has jumped by 36.2 per cent compared with the same month in 2020, placing monthly bills at around €85.34. This is almost €23 a month more than July last year for the average consumer.
Specifically, the consumer will pay €22.67 more than in July 2020, when the rate stood at €62.77. Interestingly, this amount would have been much higher if the Spanish Government had not approved a lower VAT rate for electricity in June, lowering it from 21 per cent to 10 per cent. Without this cut, the rate would have increased by another €8.54, breaking all records with an average of €93.88 per month.
July has already been the third most expensive month in history for consumers, with new data published by Eurostat revealing that Spain is the country registering the highest inflation rate for its electricity consumption in all of the European Union.
Unfortunately, it doesn’t look like this upward swing is going to improve in August. The rise in prices reflects the fact that Spain now has to pay more for electricity in the daily wholesale market, a cost which is being passed on to the consumer. On Monday, August 2, the daily wholesale price was €103.07 per megawatt hour (MWh). While this is very high, it is by no means an unusual price, as all records were broken on July 21 when the cost rose to a historical €106.57.
While the reduction in the VAT rate was a welcome reprieve and has slowed the increase in prices, Facua has criticised the government for not doing more to help the consumer, and asked for additional measures such as guaranteeing this reduced rate permanently and cracking down on bogus offers from electricity companies. It has also been suggested that taxes on income, assets and businesses be reformed so that “those with greater resources pay more.”
In addition, they have requested a new ‘social bond’ system that would represent a discount of at least 50 per cent on bills designed to benefit low-income families whose monthly wages don’t exceed €1,900. They would also like to see this scheme extended to people with disabilities, dependents and those over the age of 65.
Find out how you can save money on your monthly electricity bills here.
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