Spanish Government Will Approve New Measures On Tuesday To Lower Electricity Price

The Council of Ministers will foreseeably approve this next Tuesday a new package of measures with the aim of cushioning the rise in the price of electricity in the wholesale market, a situation that continues over time and that has caused this week to have returned to record multiple all-time highs.

Among the options that the Executive is considering to stop the rise in the price of electricity are a possible new tax reduction, the revision of the regulated tariff or PVPC so that it is not so exposed to fluctuations in the wholesale market and force large electricity companies to auction energy between traders and industrialists.

Tax retouch
On electricity taxation, the Vice President and Minister for the Ecological Transition and the Demographic Challenge, Teresa Ribera , assured last Wednesday in the Senate that the Government was considering “retouching, albeit provisionally”, some fiscal elements .

One of the options being used is to temporarily eliminate the electricity tax, which levies the electricity bill with 5.11%, and which would be added to the reduction of VAT from 21% to 10% and the suspension of the tax to electricity generation (7%) until the end of the year.

In this sense, from the Organization of Consumers and Users (OCU) they assured this week that eliminating this tax is an “indispensable” requirement so that the Government can fulfill its commitment that the electricity bill at the end of this year is similar to that of 2018.

Review of the regulated tariff
Another of the actions that the Executive could carry out would be to review the regulated tariff or PVPC , which is covered by about 11 million consumers, introducing certain mechanisms so that the final bill is not so exposed to price variations in the wholesale electricity market.

Customers who have the regulated tariff, historically cheaper than the free market according to data from the National Commission of Markets and Competition (CNMC) , are those who are suffering first-hand the rise in the price of electricity , which Friday marked a new all-time high after reaching 152.32 euros per megawatt hour (MWh).

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