October 17, 2021

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Spanish hairdressers want to pass on high electricity bills to customers

Spanish hairdressers want to pass on high electricity bills to customers

There is unrest in Spain over the rapid rise in electricity prices. On Thursday, the price of a megawatt-hour (MWh) rose to a record high of €188, although the price has fallen slightly again today. More and more Spaniards are facing problems due to high prices. A year ago, the cost of electricity in Spain was 76 euros per megawatt-hour.

The small municipality of Patres, located in the Madrid region, has become the first to refuse to pay the high electricity bill anymore. The diocese also says it can no longer afford the costs. Hairdressers fear that they will have to pass on electricity costs to their clients. The main reason is the rapid rise in the price of gas, which partly determines the price of electricity. The European economy is also recovering faster than expected and demand for electricity is high.

Recovering the profits of energy companies

The price increase has dire consequences for some Spaniards who depend directly on the fluctuation of gas prices due to their energy contracts. The unrest in Spain is so great that the government will ease the burden by decree. This is done by lowering taxes on energy bills, but also by temporarily claiming the massive profits made by electric companies. As a result, a total of 2.6 billion euros should return to the state treasury.

Spain hopes to cut its consumer energy bills by about a quarter. “Consumers with average consumption will eventually reach an amount similar to 2018 rates,” Spanish Prime Minister Sanchez promised in a television interview earlier this week.

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But the reaction was short-lived: nuclear plants are already threatening to shut down the facilities if necessary, if Madrid demands a refund of their profits. They also plan to file a lawsuit against the state.

Taxes are the problem

According to economist Jorge Sanz, the government is wrongly trying to blame producers for a high energy bill. “The costs to consumers are largely due to the heavy taxes imposed by the government. Because of the social unrest in Spain, they now have political turmoil. They refer to the international market. But that is not the problem. Taxes.”

Sans expects that the increase in electricity prices will soon be noticeable in energy bills elsewhere in Europe. National political parties are calling on consumers to cut off electricity to homes as of 10pm on Friday, October 8 and to take to the streets in a “mass protest against extortion” by energy companies.