Since the liberalization of the Spanish electricity market in 1997, consumers have been able to access different types of taxes. In April 2014, a new regulation appeared on the national electricity market that regulated the method of determining the cost of energy and that affected the electricity billing system. From that moment, the annual price per kWh of one electricity supplier may be different from that offered by another.
The Spanish market has different types of electricity tariffs that adapt to the different needs of each consumer, which must be taken into account when electricity is cheaper depending on your usual consumption. For this reason, it is essential that before opting for one company or another or for one tariff or another, we consult the most suitable It adapts to our needs and consumption.
Coward hourly rates of discrimination they set different kWh prices depending on the time of day. If we contract this type of tariffs, we must have a digital meter installed capable of measuring electricity consumption by the hour. In this case, the recipe is very simple, we will be able to save on the electricity bill yes we consume the most electricity during the hours when the price is reduced.
However, the recent changes in electricity consumption and prices mean that the established time slots are not so clear due to the taxes imposed by the Government.
The new electricity bill
On June 1, 2021, the new electricity bill entered into force, which includes a substantial change, the fixed term of the voucher or what is paid for the electricity tariff even if it is not consumed and the variable term or the part that depends on consumption, now it will be calculated differently. Let\’s see below what are the most significant changes of this new regulation:
- The new electricity tariff structure affects all consumers on the regulated market, the Voluntary Price for Small Consumers (PVPC) and those on the free market, albeit in a different way.
- Three time slots are set. The cheapest runs from 12:00 to 8:00 on weekends and holidays.
- There is also the possibility of contracting two powers, while before it was only allowed to have one. It will be possible to rent another power for lower cost periods (off-peak hours) which will be much cheaper and another for peak and flat periods.
Types of electricity tariffs
We currently have in Spain two types of taxes:
- Regulated market rates. It is a rate regulated by the Government and known as the Small Consumer Voluntary Price (PVPC). Electricity prices in this tariff are set hourly and vary from day to day. Consumers can check these prices daily through the Red Eléctrica de España website.
- Free market rates. They are those offered by different marketers where prices, discounts and contract terms are set by them, without government intervention. Within this type of tariffs there are two ways:
- Fixed price tariffs.
- Tariffs with hourly discrimination.
Over the counter trading firms offer a wide range of rates, for this reason it is very convenient to compare the different offers to hire the one that suits you best. our consumption and needs.
Regulated electricity market
The rates offered on the regulated electricity market in Spain are called Voluntary Small Consumer Price or simply PVPC. Coward characteristics of this type of tariffs are the following:
- They are only available for consumers with electric powers lower than 10 kW.
- It is necessary to have a digital meter installed to measure electricity consumption by the hour.
- Hourly electricity prices can be checked the day before from 20:30 on the Red Eléctrica de España (REE) website.
- Consumers can check every day at what time the price of electricity is cheaper, thus being able to save on the electricity bill.
- They are an option to pay less electricity bills if we do our best electricity consumption during the hours of the day when the price of electricity is lower.
Benefits of the Voluntary Price rate for Small Consumers:
- Price set by the Government.
- The possibility of knowing the price of electricity in advance.
- It does not require permanence.
disadvantage of the Voluntary Price rate for Small Consumers:
- Price without applicable discounts.
- Light prices are unstable because they depend on the wholesale market.
- Only consumers with electric power less than 10 kW can access this rate.
- It is necessary to have a digital meter installed in the property.
the free electricity market
in the free market tariff prices are set by each marketer. The consumer can choose between two versions:
- Fixed annual fee. With this type of tariff, the customer knows at all times what he will pay annually for electricity consumption, as a fixed price is set for each month of the year. When contracting, one year of permanence with the marketer is assumed. These tariffs typically increase the annual cost of electricity by 20%.
- Tariff with hourly discrimination. This tariff is characterized by offering a lower price during the night and more expensive during the rest of the day. There are different time discrimination periods: off-peak hours, super-off-peak hours and peak hours. It is a very profitable rate if the highest consumption of electricity is during the night.
Price ranges for electricity in the hourly discrimination tariff
As we just discussed there are three time intervals regarding electricity tariffs:
– Valley Time. This section includes between 00:00 and 08:00 Monday to Friday and during the 24 hours on weekends and holidays. It is the period when there is less demand, which is why it is the cheapest fare.
– Free time. This section includes 8:00 AM to 10:00 AM, 2:00 PM to 6:00 PM, and 10:00 PM to 12:00 AM Monday to Friday. It is the average rate.
– Rush hour. Its opening hours are from 10:00 to 14:00 and from 18:00 to 22:00 Monday to Friday. It is the band with the highest rate.
But it should be noted that since September 2021, the price of electricity has not followed a pattern of behavior based on these time slots, which is why, for example, it is consumed in a peak hour and yet we pay the Higher Rate. For this reason, currently, the only possible way to find out when electricity is cheaper is through The Spanish electricity grid, which updates daily what the different light prices will be in each time zone of the day.