The wholesale price of electricity has surged past €200 per megawatt-hour for the first time since December 2022, reaching an average of €201.99 on Tuesday. This comes as petrol prices hover around €1.80 per litre and diesel sits near €1.90, while Spain’s inflation rate climbs to 4.9%.
Electricity is once again a pressing concern for Spanish households. The latest increase marks a 2.6% rise from Monday and reflects the highest daily price since December 2022. This follows a particularly challenging September, when the average wholesale price closed at €143.25 per MWh, an increase of 21% from August and the highest monthly figure in four years. As a result, households under the regulated PVPC tariff saw their average bill rise to €86.22 in September, up from €79.75 in August—a rise of 8.1% in just one month.
The rise in prices is largely attributed to the increased cost of gas, driven by international tensions and the ongoing crisis in the Middle East. Gas prices influence the electricity market significantly, especially when solar energy generation decreases.
Additionally, wind energy supplies have declined, contributing to the situation; in September, wind provided only 13% of Spain’s electricity, down from 19% the previous year. While solar energy helps keep costs down during daylight hours, prices spike once the sun sets, requiring reliance on other energy sources.
Electricity costs are not the only financial burden for consumers. September’s inflation rate of 4.9% is the highest in recent years, with rising fuel and lubricant prices significantly contributing to this increase.
As of Tuesday, petrol is averaging around €1.79 per litre and diesel about €1.90. Although these prices remain significantly higher than pre-crisis levels, they have shown some recent moderation.
The government has continued a temporary reduction of €0.20 per litre on fuel prices throughout October to ease the impact of the energy crisis, but this support is set to decrease in the final quarter of the year.
Grocery prices have also felt the pinch. In the latest Consumer Price Index data from August, non-alcoholic food and beverage prices rose 2.3% compared to the previous year.
Overall, households are facing an uncomfortable scenario: rising energy costs, elevated fuel prices, and inflation nearing 5%. Higher electricity prices drive up production, transport, and distribution costs for virtually all goods and services.
The volatility within the electricity market is evident, with the maximum price expected to hit €281.31 per MWh between 9 and 10 PM, while the minimum will drop to €147.09 between 4 and 5 PM.
For households on the PVPC tariff, there is some protection against daily price fluctuations. Reforms mean that daily prices now account for 45% of their bills, while the rest comes from monthly, quarterly, and annual contracts. This has softened the impact of wholesale price increases on final bills. However, the average cost for a PVPC household has risen from €67.61 in September 2025 to €86.22 a year later, and with wholesale prices exceeding €200 again, relief is limited.
The government is also considering new tax cuts on electricity. Measures approved at the end of September would allow VAT and electricity tax reductions in November and December if certain thresholds are met, but October continues with a standard VAT rate of 21% and the regular electricity tax rate.
With these developments, it’s clear that the cost of electricity is on the rise again. Fuel prices continue to burden transport costs, food prices remain elevated, and inflation is pushing towards 5%. While not all prices are increasing uniformly, energy once again appears poised to be a major factor in rising household expenses, with the first signs of strain coming through electricity bills.
