What's happening to electricity prices?

Life in Spain Wed, 19 Feb 2014
What's happening to electricity prices?

If you own a property in Spain chances are that your recent electricity bills have given you cause to draw breath. The majority of householders have noticed a steep rise in Spanish electricity prices over the past few years.

It isn’t just a case of poorly insulated homes or wasteful home owners. Spain’s electricity bills are amongst the highest in Europe and have risen 60% between 2006 and 2012. Two price rises in October and August have made a significant difference to bills and they were due to go up even further in January.

The forecast had been for another 11% rise to welcome in the new year. However, the government interceded and the price rise was reduced to a slightly more reasonable 2.3%. But why should there be any price increase at all?

In El País a recent article has highlighted some of the reasons behind the continuously climbing cost of electricity in Spain. They report that according to the government, the problem has been caused by an electricity deficit. There is a difference between the amount it costs the electricity companies to power generators and how much money they get from their customers.

It’s renewable energy that’s partly being blamed for this. Subsidies were provided for those generating their own electricity through means such as solar power. The trouble is they produced more than anticipated, whilst the running costs of the ordinary power generators and intermediary equipment remain.

El País reports that for some time the charge passed down to customers remained capped and now the electricity companies are trying to make up the deficit. The tendency to limit electricity price increases goes back to 2002 when they were prevented from rising by more than 2% each year. This was in spite of higher production costs. A situation that has been maintained for almost a decade.

El País, however, point out there are other factors and interests at work too. Electricity is produced in different ways, some methods have much higher operating costs than others. Consumers pay the same amount, meaning that some producers and brokers are making big profits that consumers don’t see the benefit of. 

In the end, all the theory around the escalating cost of heating and lighting your home makes little difference to those faced with paying the bills. Electricity can hardly be classed as a luxury item in our society. In most cases households are dependent on it for their most basic of facilities. Lighting, heating and cooking often depend upon it and many households rely on electricity for their hot water. Some will not be able to afford it this year.

According to El País, the Red Cross are estimating that around 40 % of the families who come to them for help cannot keep their homes warm in winter. Last year, 1.4 million homes had their electricity cut off for non-payment.  A society in which such large numbers can’t access one of the most basic household needs is a problem for everyone.

More information

‘The shocking price of Spanish electricity’ El País in English, 1st January 2014.

Comments

It seems to be, as in many things regarding money, that prices are increased to get as much out of the individual as possible.Not that as a result of any increase in price many people cannot afford the increase and so less revenue is collected.

It is an outrage that Spain has such high costs for power, while exporting electricity to France, for example that has almost the lowest costs in Europe. Worse are the absurd fines for private solar power units that put electricity back into the grid. There are some legal challenges to this madness at the level of the EU- one can only hope they will prosper.

In your newsletter it stated that a deceased person could not be removed as they could not find his passport to confirm his resident or non resident status? How could a passport do this anyway?
There is no address in it.they are no longer stamped when you go back and forth to the UK.It could only be used to identify him, not confirm his resident or non resident status!

 

Dear Marion

Thanks for your comment. As we understand it, the deceased person or their companion, in this case, could not speak any Spanish and had no identification whatsoever on them to enable the authorities to check whether or not they were resident or non resident. If the authorities had access to at least the passport, the name and number could have been tracked. 

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