Contracting electricity in Spain

Some day you will find out that you are paying too much for electricity or you will buy your own house and will need to contract this vital service. Understanding how the electricity market operates in Spain will save you a lot of time when looking for the best offer for your needs.

The Spanish electrical system

The electrical system in Spain is divided into several separate sectors. Over some of them the end user has not influence whatsoever -- these sectors are under the control of the government. However as an end user, you have control over the last mile by choosing the distributing company to which you will pay your electricity bills.

Generally the chain of electricity supply can be divided into three major sectors:

Production.
Transfer.
Distribution.

While production and transfer are under exclusive government control, the distribution part is delegated to various companies, with which you can sign a contract and pay for your electricity consumption. There are many distributors on the market. Some of them are very popular with well developed customer service network (like Iberdrola), others do not have that extensive office coverage and there are also companies that operate exclusively over remote channels (phone/internet). Here we will give some hints on how to choose a distributing company.

Your electricity bill

Your electricity bill have three major components, forming the final price that you will be charged:

Contracted potency actual consumption, additional services.

Contracted potency is the power that you will be provided throughout the day and the night. This potency limits you with the number of electrical devices that can operate simultaneously. It is measured in kW (kiloWatts) and each month you will be charged a fixed fee for each kW. Generally the price that electrical companies charge is about 42 EURO per kW per year, which makes it roughly 3,5 EURO/kW/month. Most houses choose 3,5 kW potency, as this is more or less enough to cover basic needs, but how much you would need strongly depends on the type of power your house utilizes - if you use gas for water heating and cooking then you don't need that much electricity, but if you depend on electricity for all of your needs then you might consider contracting even more potency.

In case you go on with 3,5 kW/month, then the first component of your bill would be:

3,5 kW x 3,5 EURO = 12,25 EURO

Next comes the actual consumption that you have had during the month. Here the numbers vary significantly, based on the plan that you have contracted and the chosen distribution company. Almost all companies offer plans with different charging during day time and night time.

Daytime hours are 12:00 - 22:00 during winter and 13:00 - 23:00 during summer. Nighttime is all the rest of the hours. In general companies tend to charge like 15 cents/kWh/daytime and 8 cents/kWh/nighttime. Of course there are flat plans - you will be charged the same day and night, fixed plans in which you will be charged fixed price each month regardless of how much you consume and others. Finding the best offer for you requires some research and comparison of the offers that the companies have.

And finally you have the additional services. These vary from company to company, but some might offer you surge protection, other would charge you for the measuring device that you have.

Major companies on the market

Perhaps the most popular distribution company is Iberdrola. However Iberdrola is also producer of electricity, so the entity that does the distribution is called Iberdrola Clientes.

Iberdrola in general is quite expensive, but very popular, with many offices where you can walk-in and talk face-to-face to a representative, asking all questions that you might have. Perhaps this is the reason why it is so widely used.

Endesa is another company that you might consider during your research. It sells a bit cheaper than Iberdrola and you can achieve savings of about 10-15%.

EDP sells at prices similar to Iberdrola's but here for each EURO you spend for electricity you will get points on your Carreofour check which you can spend at the stores of Carrefour.

Holaluz is mostly an internet player, they have some very interesting tariffs like flat monthly fee with unlimited consumption, but evaluate carefully the contract because there might be surprises.

Of course there are many more, we can't cover all companies here in this article, but you can do some research on the internet to hunt for the best tariff.

Contracting electricity

If you have bought or rented a home, and you'd like to have the electricity bills arriving with your name on them, then you have to change the contract. This could be achieved quite easy with Iberdrola, if you go to an office and request for a change of the titular of the contract.

You will need to present some proof of ownership - notary certificate (escritura) if you have purchased the home or rental contract. You also need to have a NIE and bank account to be charged (not mandatory!). The change of the titular will be authorized only if there are not pending bills!

In some cases, usually when you buy a home, the prior owners might have a lot of unpaid bills. This would block the change of contract unless you pay the bills. But if we are talking about thousands of EURO, then it does not sound like a good deal. But don't worry, there is a way to overcome this. What you need to do is to request termination of the current contract (baja) and establishment of a new contract under your name (alta). Charges involved in this operation would be about 150 EURO, so if the old owner has less than 150 EURO unpaid consider paying them and then changing the titular.

Later on, if you are going to be contracting another company it would be very handy to know your CUPS number. This is an unique number, that identifies your measuring device (contador). 

Good luck with your hunt for cheaper electricity!