The sum that appears on the electricity bill is used to cover other costs not directly related to the power supply. What are these other costs?

The bill shows other costs not directly related to the provision of electricity: direct and indirect taxes, subsidies and payment of the rate deficit.

Which taxes are included in the electricity bill?

Currently two types of taxes are paid directly on your electricity bill. On the one hand, VAT, which for electricity is set at the maximum rate of 21%. On the other hand, the Electricity Tax, used to finance the Autonomous Communities.

The sum total of all these taxes represents 29% of the electricity bill, which is much more than the standard 21% VAT.

What are the subsidies for renewable energies?

Subsidies for renewable energies represent more than €18 out of every €100 paid on the electricity bill.

What is the rate deficit? What is the annual fee for the rate deficit?

The rate deficit is the difference between the real cost of power production, distribution and delivery and the price paid by consumers through their electricity bill, which is less, and consequently, does not cover that real cost. Through a Government decision, this difference is paid for “in instalments” and is reflected in the electricity bills of following years, with their price, therefore, increasing.

Currently, payment is still outstanding on a deficit of 26 million euros accumulated over preceding years. In 2013, an additional deficit has been generated to date in the amount of almost 4.5 million euros, although the Government hopes that once all of the year’s costs and revenues have been accounted for, this figure will decrease to just 3.6 million. The Government has adopted different measures in order to correct the disparity by sharing the burden among electricity firms, special regime producers (solar, wind, etc.,) and consumers.

The higher the accumulated deficit, the higher this amount is. In 2013, it has meant almost 3 million euros, which represents more than €5 out of every €100 paid by domestic customers on their bill.

Other charges on the bill, like the non-mainland systems: Ceuta, Melilla, Canary Islands and Balearic Isles.