New regulated electricity rate to stabilise prices in Spain

The tough times in which millions of households have lived throughout Spain during the past year due to the rise in cost of electricity is over thanks to a new regulated electricity rate. Customers with the contracted PVPC (Voluntary Small Consumer Price) will see that part of the price they pay for electricity will remain stable.

The government approved the measure on Tuesday, with the reform of the PVPC, which was one of the commitments it had with Brussels after the European Commission authorised the 'Iberian exception'. This will lead to a new formula whereby 25% of the price of electricity will be linked to future prices, throughout 2024; 40% in 2025; and 55% of the entire price in 2026.

The new PVPC bill will replace the current one, without customers having to make any changes to their invoices or the providing company (Iberdrola, Endesa, Naturgy, Total, Repsol or CHC). In the 'energy consumed' part of the receipt, the company must indicate what is the stable price that is being paid, and which will be renewed every month, as well as the variable costs that change both day by day and hour by hour.

The new regulated rate will also make it impossible for users to benefit from falls that may occur in the market. For this reason, the new PVPC will become increasingly similar to the current fixed rates of the free market, which have this mechanism linked to futures contracts.

In addition, the new regulated bill allows for by some 1.5 million users to receive discounts of up to 80%, depending on income and family economic situation.