Government has power to end soaring electricity prices

As the cost of electricity skyrockets in Spain, the government could lower the cost to vulnerable customers and companies if it wanted to, the EU has said.

As each day sets a new record for the cost of electricity in Spain, the government has the power to lower it, if it wanted to, the EU commissioner for Energy has said.

In reply to a query from Partido Popular’s Dolors Montserrat, Commissioner Kadri Simson wrote that electricity companies “are free to set the price at which they supply electricity to customers” but she added, “Member States must guarantee effective competition” and “in parallel, Member States can apply some safeguards, such as public interventions in setting prices for the supply of electricity to domestic customers in situations of energy poverty or vulnerable.”

“EU state aid rules allow, under certain conditions, Member States to compensate large energy consumers for part of the financing costs of renewables and part of the indirect costs of carbon emissions,” wrote Commissioner Simson.

Small businesses are being hit by price hikes worth hundreds of euros every month, ABC reported.

On August 11, Electricity bills in Spain hit a new record high in the price average for the fourth consecutive day, reaching €115.83 per megawatt-hour (MWh).

This price is 1.6 per cent higher than the previous historical maximum set just one day earlier when the price stood at €113.99 compared to the same date a year ago when the price was €40.52 per MWh.

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