The average electricity bill rose 0.8% in May compared to April and soared 43.8% compared to the same month last year , thus maintaining its upward trend in recent months.
In this way, the electricity bill, when the new scheme comes into effect this Tuesday that will encourage more efficient consumption by consumers, seeking that the amount of the final bill depends more on when than on how much is consumed, with The transfer of consumption to the so-called ‘off-peak’ hours continues with the increases that began in March, after the truce that occurred in February after shooting up in January due to the tensions caused by the impact of the storm ‘Filomena’ and the wave of cold .
Specifically, the average bill for a domestic consumer amounts to 75.92 euros in May , compared to 75.32 euros in April, according to data collected from the simulator of the National Markets and Competition Commission ( CNMC). To make a homogeneous calculation, the last day of March has been included in April, since May has 31 days.
Of this amount of the receipt in May, 14.88 euros correspond to the fixed term, 44.81 euros to consumption, 3.05 euros to the electricity tax and 13.18 euros to VAT. This electricity bill corresponds to an average consumer with a contracted power of 4.4 kilowatts (kW) and an annual demand of 3,900 kilowatt hours (kWh), typical of a family with two children.
Compared to a year ago, the increase in the electricity bill for a consumer is almost 44%, with a difference of more than 23 euros . However, in May of last year there was a sharp drop in demand due to the restrictions applied after the declaration of the state of alarm to face the covid-19 pandemic, as well as a price in the electricity market especially under.
Most expensive price since 2018
This increase in the electricity bill for May is mainly due to the rise in the average price of the wholesale electricity market, known as the ‘pool’, which closed the month at almost 67 euros per megawatt hour (MWh) , its highest level so far in 2021 and would have to go back to September 2018, when it exceeded 71 euros per MWh to find a higher level.
In fact, for this Monday the price of electricity stands at an average above 88 euros per MWh , levels that have not been seen since last January in the heat of the cold wave due to ‘Filomena’, with peaks in its peak hours above 93 euros per MWh.
This rise in the pool is mainly due to CO2 emission rights prices that reached new record levels in May, as well as a rise in the price of gas. The wholesale price of electricity has a weight close to 35% on the final bill, while around 40% corresponds to tolls and the remaining 25% to VAT and Electricity Tax.
The wholesale market works in a marginal way, so that technologies enter in order of cost and the last one to participate, the most expensive, sets the price for the whole. Meanwhile, consumers who are in the free market are exempt from fluctuations in the daily price, since they have a price agreed with their company.
So far in 2021, the electricity bill amounts to about 341.8 euros for an average consumer , which is almost 22% more than in the first five months of last year.
The reform being prepared by the Government
In order to contain this impact on the electricity bill due to the impact of CO2, which for some time has been installed above 50 euros per ton, in the price of electricity, the Government has already advanced a mechanism, which he plans to take to the Council of Ministers this Tuesday in the form of a draft law, to tackle the overpayment that power generation through hydraulic and nuclear plants receives in the wholesale market , which will result in a reduction in the consumer bill.
With this, it will open the way to the reform of the electricity market with the elimination of the well-known ‘benefits fallen from the sky’ for these technologies of the energy ‘mix’, which was included in the coalition pact between PSOE and United We Can.
Specifically, and with this regulatory draft, the electricity companies will have to affect their production cost the CO2 emission rights for these two types of generation, for which they will be discounted from the wholesale market price. In this way, your situation will be analogous to the conditions that gas plants already have.
The forecast is that, based on current prices for the emission of CO2 of about 50 euros per ton, such reduction (if total) would have an impact of at least 1,000 million, which in turn would lower the cost of the bill of 4 or 5%.
However, and in a scenario of a cost of 100 euros per ton of C02, it would reach 2,100 million although these levels are considered unlikely.