PIXABAY

Cap on gas prices in Spain for the next year will bring electricity prices down too

The EU has given Spain and Portugal the green light to cap the price of gas on the wholesale market for the next 12 months

JOSÉ MARÍA CAMARERO Madrid

The EU has given the green light for Spain (as well as Portugal) to cap the price of gas on the wholesale market at 50 euros/Megawatt hour for the next 12 months. As gas is used to generate electricity, energy bills for many are set to come down too.

The move, which was approved despite opposition from some energy suppliers, should get Spanish cabinet approval next Tuesday.

The measure will benefit those 10.5m billpayers who have a regulated (non fixed) tariff (shown on bills as PVPC). Experts say that in these cases electricity bills could fall 40 per cent.

For the moment, IVA will remain at 10% and the electricity tax at 0.5%.

It is not yet clear who will pick up the bill for the government’s price cap on gas and compensate the energy generators.