Urgent measures to lower electricity and gas bills

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1. A minimum vital supply is created: vulnerable consumers with the social bonus who cannot pay their electricity bill will not be cut off. After four months of non-payment, their power capacity is adjusted for six more months without supply being interrupted.
2. The tax on the value of electricity production is suspended for the third and fourth quarters of 2021, so producers can offer lower prices.
3. The Special Tax on Electricity drops from 5.11269632% to 0.5% until December 31, 2021, with minimum amounts depending on how the electricity is used.
4. The money from CO2 emission allowance auctions earmarked for reducing electricity system charges is raised to €2 billion, which lowers bills.
5. Auctions of long-term energy purchase contracts are set up to improve liquidity and competition in the electricity market. The first auction will be held before December 31, 2021.
6. Non-emitting power plants in mainland Spain, larger than 10 MW and without a specific compensation scheme, will see their compensation reduced while the gas price exceeds €20/MWh, at most until March 31, 2022.
7. The increase in the raw material cost of the regulated gas rate (tarifa de último recurso) is capped for two quarters, to prevent gas bills from jumping 30-40% at once.
8. Rational water use criteria are introduced for large reservoirs, and the period covered by the COVID Line direct aid for self-employed workers and companies is extended to September 30, 2021.

Who it affects

• Vulnerable consumers with the social bonus: They cannot have their electricity cut off for six additional months in case of non-payment.
• Owners of non-emitting power plants over 10 MW: Their compensation is reduced while the gas price is above €20/MWh, until March 31, 2022.
• Customers of the regulated gas rate (tarifa de último recurso): The increase in the raw material cost of their rate is capped for two quarters.
• Retailers and large consumers: They can buy energy in the long-term contract auctions and must reflect this on their invoices.
• Self-employed workers and companies receiving COVID Line aid: The period for expenses covered by direct aid is extended to September 30, 2021.

Words worth knowing

Suministro mínimo vital (minimum vital supply)

Protection that prevents cutting off electricity to a vulnerable consumer and adjusts their power capacity to a 3.5 kW minimum for six months.

Tarifa de último recurso (last resort rate)

A regulated natural gas rate for consumers with low pressure and consumption, such as households and small businesses.

Instalación inframarginal (inframarginal plant)

A plant that produces electricity more cheaply than the market price, so it earns an extra profit when prices rise.

Derechos de emisión de CO2 (CO2 emission allowances)

Permits companies must buy to emit greenhouse gases; their auctions bring revenue to the State.

Cargos del sistema eléctrico (electricity system charges)

The part of the electricity bill that funds common system costs, such as renewables.

It summarizes the law as published in the BOE. It is written by artificial intelligence and may contain mistakes: the official text is what counts. Read the official text · How we make summaries