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Spain Cuts Power Taxes as Wholesale Prices Rebound and Free Hours Disappear

Ancillary charges plus volatile energy costs limit the impact on final bills.

Overview

  • VAT on electricity drops from 21% to 10% and the special electricity tax falls from 5.11% to 0.5%, taking effect upon publication in the state bulletin on Saturday.
  • The day-ahead market average for March 20 is €37.57/MWh, roughly 50% higher than Thursday’s €24.95/MWh, according to OMIE.
  • Friday features no free or negative-price hours, with the most expensive slot at 19:00–20:00 reaching €98.72/MWh and the cheapest hours concentrated around midday.
  • Selectra estimates an average household will save about €8 per month, though the benefit varies by tariff and regulated PVPC customers may still pay more than in February.
  • System adjustment and technical-restriction costs have surged by about 68% in recent months under a reinforced operating mode, adding pressure to final bills.