As electricity prices rise, how can you become energy savvy?

Electricity tariff Spain

The increase came after last week's energy auction for distributors of the TUR electricity tariff, where prices for the fourth quarter closed at 7.6%. Spanish sources claim the increase affects over 20 million Spanish homes and small businesses. 

This is the fourth increase this year, as prices rose by 3% in January, fell a significant 6% in April, but rose again in July by just over 1%, subsequently followed by a 3.2% rise in August, due to the electricity reforms. More alarmingly, it’s the 24th increase since the TUR  (Tarifa de Último Recurso, or Ultimate Resource Tariff) was introduced.  

Industry, Energy and Tourism Minister, Jose Manuel Soria, argues that without these measures, which are helping to curb the tariff deficit, currently at 26 billion €, the consumer price for electricity would have increased by 42%. Soria explained that there were only two options open to the government: adopt regulatory measures to curb huge yearly increases in the tariff deficit and increase competitiveness, or directly increase consumer prices by 42%. Evidently the first option was the better of two evils. Soria explained, “we chose the first option, to adopt a set of measures that do affect consumers, but which also affects the public administration, which is partly financed from the budget. The option to increase prices by over 40% was never considered.”

So how do you ensure you keep an energy smart holiday rental?

Official data shows the fixed power rate has increased by over 42%, although the kWh rate has decreased by approximately 62%. If you own a holiday rental or are a second home owner and only use your property for a few months a year, it is likely that you will be affected by these continual increases.

Saving on your fixed power rate:
Grab your last electricity bill, you will see that part of the cost is a fixed amount, which depends on the kWh rate that you have contracted. If you can, go back and check the last 12 month’s bills. Compare the consumption to what you have contracted. If you are consuming less than what you have contracted, you can call your supplier and ask them to reduce your rate. 

If you are not sure what the rates should be, use this guideline:

  • Small to medium sized home with gas or electric heating and electrical appliances: 3.3kW
  • Large villa or house with air conditioning: 5.5 kW
  • Large villa or house with heavy electricity consumption (eg. heating, pool, etc): 10 kW plus

Always use the TUR official tariff:
Contrary to what some may tell you, very few companies are able to offer you rates below the official tariff. This generally applies to all usage under 10 kW. Companies that claim they can offer better rates normally insist you take out additional services, which incur extra charges and therefore counteract any savings.

You can visit the National Energy Commission website and compare current tariff from various suppliers who work within the official TUR rate. Here you can compare normal tariffs with night tariffs and see whether you can save on your bill by switching to a night tariff.


Time of Day tariffs:
‘Time of Day’ or night tariffs can help reduce your energy costs as they distinguish the kWh period rate based on low and peak hours. The hours in each period vary by season i.e. winter and summer hours.

The peak period works from noon until 10pm during the winter and from 1pm to 11pm during the summer. The idea is to reduce your usage of appliances that use a lot of energy during this period i.e. washing machine, dishwasher, heaters, etc. 

The low or valley period works from 10pm to noon during the winter and from 11pm to 1pm during the summer. Now electricity prices are reduced, so it’s the best time to use these appliances.


Smart Meters:
Smart meters Endesa EnelSpain has issued a new regulation, which will see the end of the traditional household meter and a change-over to smart meters. This is due to the inaccuracy of existing meters and meter readings. All homes with a contracted supply of 15kw or less will be swapped over by 2018. We understand around 35% will be swapped by the end of this year.

When you receive a notice to confirm your meter is being changed, it’s a good idea to make sure you or a representative is present at the final reading. The change-over is free, although some companies did try to charge. Thankfully they were stopped by the National Energy Commission. New fixed rates will apply to the smart meters of 0,81 € and 1.15 € depending on the meter installed. A monthly rental fee will be applied to the new meters. There is an option to pay for the meter and its installation upfront, forgoing the monthly rental rate. You will need to check if your home meets certain technical requirements to do this. We understand Endesa has challenged the new fixed rates in the courts, wanting to increase, rather than decrease them. A decision is pending. 


More solutions:
Ecoforest wood pellet stoveIf you want to make your holiday rental more energy efficient there are other options you can consider. A biomass wood burning stove is one example that offers a cheap and efficient heating solution. The wood pellets burn to produce a renewable, clean biomass fuel and makes for a lovely cosy home during the winter months. Some of the best stoves available on the market are manufactured in Spain, such as Ecoforest, who invented the wood pellet boiler.

Installing renewable energy solutions implicate an upfront cost, but long-term savings are worth it, even with the proposed privatisation of the 'sun'.There is a huge debate in Spain at the moment on solar power and other renewable energy solutions. The government is looking to introduce a new energy reform which will force users to pay a ‘toll’ on the use of renewable energy. The draft bill will penalise households and businesses who generate renewable energy and who are not connected to the national grid.   

Upgrading your current appliances to energy efficient appliances, is a good way to reduce your electricity bill. It will also improve your holiday rental's energy rating, when you apply for your Energy Performance Certificate

Simple options like swapping to led lighting, replacing air conditioning with ceiling fans and unplugging unused appliances, also help to reduce consumption. 

Make your guests aware of the high cost of electricity. Ask them to be considerate about the amount of time they use the air conditioning, not to fill up the fridge completely and to only use the dishwasher and washing machine when they have a full load. Not easy we know, but you can ask!