When it gets cold, and more so when it gets hot, Spain uses more electric. This is not a great surprise. The nuclear power stations never go offline but all the other forms of electricity generation have ups and downs. You can't pull so much from wind turbines if there is no wind, the solar panels don't work so well at night and even the hydroelectric stations are affected by droughts and rainstorms. When all else fails the gas and oil fired power stations are brought on line. The power generated from these fossil fuel plants is the most expensive to produce. Through some complicated mathematical formula a Spanish Government agency calculates the cost of generating each individual unit of electric at any given time. This fixed price is based on the most expensive generating capacity in use. So when the demand is so high that the gas and oil burning power stations are fired up the price goes up to match. This fixed price affects the bills of ordinary consumers. More precisely it affects the price of users in the regulated market because Spain has two sorts of domestic electric contracts: the regulated market and the free market
The energy market in Spain was liberalised years ago. When it first happened I looked around a bit at different providers and I couldn't see any advantages in changing. With the passing years, that situation has changed and I should have shopped around but inertia and I have always seen eye to eye.
We don't get cold callers in Culebrón, actually that's not true, a couple of Witnesses turned up in 2005 and occasionally the melon man blows his horn outside the gate but, in general, peace reigns. I hear it's not the same in the big cities with an endless procession of smooth talking salespeople bearing electric and gas contracts pounding on people's doors. It's not something the telephone sales people try to sell us either.
Every now and again the price of electricity gets media coverage. Last week we apparently reached the highest price ever. The kerfuffle in the media made me curious and I had a look to see how it was all organised and what sort of contract we had.
Although the devil's in the detail there are, fundamentally, just two options for those properties with a supply of less than 10kw. The regulated tariff and the free market tariff. The regulated tariff uses prices per unit of electricity set by the government. This is the one that gets the media mention. This is the tariff that we have. If you're in Spain and you have this sort of contract your will have the letters PVPC somewhere on your contract or, if it's written in English, VPSC. It's Precio Voluntario al Pequeño Consumidor for those who are interested.
The second tariff, the free market tariff, is the alternative and it's available everywhere from over 270 providers. What the contracts offer, how much they cost and what they include and exclude is only limited by the ingenuity of the contract writer. Potential customers compare the various offers and sign on the dotted line for whichever option they think is best. My guess is that the permutations between the fixed costs, the unit price, inclusion of service contracts and other factors are almost boundless. This is where the price comparison websites must come into their own. If you need a supply of more than 10kw this is the only option available to you.
The regulated tariff, the one affected by the official government price, is only available from the eight power companies which are called Comercializadores de Referencia which, sort of, translates as the Reference Marketers. In the regulated tariff contracts the fixed or standing charges and the per unit price are separate. There are three options or modalities about how the units of power are offered and charged. Option one is that the charge is the same at any time of the day or night, option two is that the day is divided into two twelve hour periods with a higher and a lower price for each period and the last option is that the day is divided into three eight hour slots with three different prices per unit at the different times - the last one is particularly useful for people with electric cars to charge.
The Comercializadores de Referencia can also offer a fixed price annual tariff. In that case they tell you how much each kilowatt will cost during a calendar year and you sign up (or not) knowing that will be the price without being subject to the ups and downs of the market.
With trying to work out how our regulated bill was put together I read the bill properly for more or less the first time ever. Generally I just look at how much and when I have to pay. We get our electric from Curenergía which is a part of Iberdrola and I realised that they had already done most of the donkey work for me in the small print at the bottom of the bill. They do an analysis which gives comparisons between how much you have paid with your current modality and how much you would have paid under one of the other modalities. I still couldn't be bothered to go hunting around for the best deal on the free market but I did realise that simply by going to the sort of bill where the prices are different for each twelve hour period we could save maybe 100€ a year and I could do that online in a few minutes.
So I did.
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The photo by the way is from back in 2010 when I taught English to people who worked at this gas fired power station in Cartagena. The plant was later bought by Gas de France. I remember being told that the whole plant had been on standby for a whole year, not used at all, and that if they were needed it took a few days to bring the plant online.
