Increase in VAT on the electricity bill

The return to 21% VAT might seem daunting, but there's good news for those who have invested in renewable energy solutions, such as photovoltaic modules. Thanks to these facilities, the impact on monthly spending could be much smaller than expected, continuing to enjoy significant savings.

Reasons behind the increase in VAT

The criteria for applying VAT to electricity directly depends on the price of the wholesale electricity market. Specifically, VAT remains at 10% if the price exceeds 45€ per MWh. If the price falls below this threshold, the VAT applied rises to the original 21%, as is the current case.

Impact assessment, does the increase in VAT affect you?

The increase will mainly affect those with a consumption of less than 10 kWh. Consumers with higher consumption were already subject to 21% VAT. Regardless of whether your rate is free market or regulated, this increase in VAT will be reflected on your bill.

How to minimize the cost on your electricity bill?

• Choose the Right Rate: Opting for a rate that fits your consumption can result in significant savings. Currently, we find offers with a fixed price of 0.11€ kWh.
• Manage your energy consumption: Be aware of your energy use, keeping control over connected devices and the temperature in your home.
• Investment in Self-Consumption: Installing solar panels not only reduces your electricity bill, but it also protects you against future tax increases.

Conclusions

While the increase in VAT presents challenges, it also provides an opportunity to reconsider our energy options. Opting for more sustainable alternatives can lead to a future where we are more energy efficient, benefiting both our finances and the planet.