I wanted to write “temperatures go down; Electricity goes up,” but there wasn’t enough room in the heading box, but you get the gist, I hope.
Snow covers half of Spain and homes need to consume more electricity, but as is always the case, at this precise moment in time, the price per kilowatt goes through the roof.
The fact is that electricity has never been as expensive as it is at the moment, starting last Friday when the price per megawatt/hour on the market reached 95 euros, thanks to the present system, as well as a problem that has been kicked down the road since around 1996.
The peak periods are the worse, which is why it’s questionable lunacy to choose anything other than a flat rate over 24 hours. Last Friday between 11.00h and 12.00h and between 20.00h and 22.00h, consumers paid 114 euros per megawatt/hour, meaning that your electricity bill went up almost 30% compared with the week before on that day.
In other words, you are paying 16.8 centimes per kilowatt hour. Bear in mind that this means a two-bar electric fire costs you a euro every three hours… and that’s without including IVA and other taxes.
All this means that if these prices are maintained during the rest of the month the average monthly electricity bill would be 80 euros instead of 67 euros. That increase might not cause you particular concern if you don’t have to count your pennies but for many, many families in Spain, it’s a toss up between keeping warm or putting food on the table.
What has pushed the price up is the increased cost of natural gas, a lower output from wind farms and above all, an increased demand. Algeria – our main supplier of natural gas – has cut production. Very low temperatures in Asia has increased demand there, pushed up prices, making it even more expensive to rely on this energy source supplied by Russia.
“Hey,” you say, “but why has there been little output from wind farms if it has been windy as hell?” Simply because when wind speeds reach a certain intensity the blades are feathered on the windmills to prevent damage, meaning that too much wind is as bad as too little.
Spain has 26-million domestic consumers (homes) of which 40% are PVPC (Precio de Venta al Pequeño Consumidor). This means the price you pay depends on the wholesale energy market; if prices go up, so does your bill. If on the other hand you have opted for a flat rate, you pay the same rate for your electricity all year round.
It would be unfair and misleading not to mention that 2020 had the lowest electricity prices over the previous 15 years.
Editorial comment: Opting for the PVPC is a mug’s game, many consider, so make sure you have researched to pros and cons before changing over.