MILAN. Light tariffs more than halved in the second quarter of this year which will drop, for the protected market, by 55.3% starting from April. However, system charges are back while those for gas are still zeroed (and social bonuses are strengthened). For consumers, this is a record drop that brings electricity bills back close to pre-energy crisis levels with savings of 793 euros per family.
What happened? In the evening, Arera communicated the new decisions and the new data, making it known that with the sharp drop in the wholesale prices of energy products, the reference price of electricity for the type1 family in protection in the second quarter of 2023 is reduced by -55.3%. There was great anticipation for the communication and attention was focused on the decision on the charges which, according to consumer calculations, will amount to 125 euros per family and which will start on April 1st.
In the press release Arera explained that «By implementing the provisions of the Government in the decree approved on 28 March last, the Area intervened on the general system charges, also resetting them for the next quarter for most gas customers and confirming the enhancement of the electricity social bonuses and gas for families with an ISEE level of up to 15,000 euros (with the ISEE level for large families, with at least 4 dependent children, rising to 30,000 euros). The general system charges are instead reactivated for all electricity customers, including domestic users.
Interventions that go hand in hand with the confirmation of the 5% VAT reduction on heat management, district heating and gas. Also for gas, the negative tariff component UG2, introduced in April of last year by Arera and applied to consumption up to 5,000 sm3/year, is gradually reduced and then eliminated during the second quarter of 2023. A special measure that has made it possible to counteract the peak in gas prices for families and small users ».
The Authority also explained that the performance of the energy markets saw wholesale gas prices drop sharply in the current quarter, influenced by various factors: a declining European demand (-13% in 2022 compared to 2021), a contained recovery in Asian demand for LNG, the recovery of operations or new liquefaction terminals in the United States and regasification in Europe.
The mild temperatures of the winter of 2022-2023 favored a limited use of European storages (still full at around 57% of their capacity in mid-March) and forward prices indicate less tense conditions for the balance of gas supply and demand in the second quarter of 2023.
In this context, forward electricity prices also moved downwards, after the sharp falls already recorded. Already in the first quarter of 2023, based on preliminary data, the single national price of electricity (PUN) was in fact down by around 36% compared to the fourth quarter of 2022.
«We are in a new and in a sense still delicate phase of this very long crisis – says the president of Arera, Stefano Besseghini – The wholesale gas prices highlight a market that has taken seriously the European effort to diversify and consolidate infrastructure. We see the signals being quickly transferred to final consumers, also thanks to a regulatory system that works. However, we must not lose focus on the commitments made and on the implementation of the choices made».
For gas prices we will have to wait a few more days. On the basis of the calculation method introduced last July by Arer (resolution 374/2022/R/gas) the price of gas for customers still under protection, for gas consumed in March, will be published on 4 April 2023 (second working day, after the end of the reference month).
Effects on the electricity bill
Arera writes that the growth in wholesale prices in the last year and their remaining at high levels (albeit decreasing) is still reflected in the overall expenditure for the electricity bill. In terms of final effects, the expenditure for the typical family in rolling year 2 (between 1 July 2022 and 30 June 2023) will be approximately €1,267, +33.7% compared to the equivalent 12 months of the year previous (July 1, 2021 – June 30, 2022).
Therefore, the support provided by the energy social bonuses in support of families is still relevant. These are paid directly in the bill to all eligible families, provided they have a valid ISEE during 2023 and within the threshold of 15,000 euros (30,000 euros for large families). In this regard, please note that the ISEE is valid for the calendar year and it is therefore important to resubmit the Single Substitute Declaration (DSU) to obtain certification for 2023.
The components of the bill
In detail of the individual components in the bill, for electricity the change of -55.3% in the final price of the typical family, which is thus 23.75 euro cents per kWh, is substantially linked to the sharp decrease in the energy item (PE) -60.9%, to a slight decrease in the dispatching item (PD) -1.2%, to an adjustment of the marketing items (PCV and DispBT) +0.5% and to the increase in the item system +6.3% following their reactivation. The regulated network tariffs (Transportation, distribution and metering) remained unchanged.
And consumers
A record drop in tariffs that exceeds all expectations and brings electricity bills back close to pre-energy crisis levels. This was stated by Codacons, commenting on the tariff update for the next quarter decided by Arera, with electricity prices falling by 55.3% from 1 April.
A reduction which is equivalent to a lower annual expense compared to the current tariffs equal to -793 euros per family, and which contradicts the forecasts of those who in recent days had spoken of an incoming sting on bills.
But the savings for Italians could be even higher if Arera, as announced yesterday, confirms the 10% cut on gas tariffs in March: a lower cost of 121 euros per core which, added to the drop in electricity, would lead the total savings to reach 914 euros per year per core.
«However, the return of system charges on electricity bills hangs over these numbers, which starting from April will weigh at full capacity by 125 euros per year per family and will reduce the effective savings for Italians, considering that this item is restored precisely when household electricity consumption increases» concludes the president Carlo Rienzi.
According to the study by the National Consumer Union, if for a typical family in guardianship the -55.3% means spending 793 euros less on an annual basis, the savings could have reached 883 euros if the charges had not been reintroduced. Furthermore, the total expenditure in the next twelve months (not, therefore, according to the rolling year, but from 1 April 2023 to 31 March 2024, assuming constant prices) remains high, 641 euros, which added to the 1210 for gas, determine a total sting of 1852 euros.
Finally, if the price of electricity drops by 55.3% compared to the current one and by 42.5% compared to a year ago, i.e. in the second quarter of 2022, compared to pre-crisis times, i.e. in comparison with the April – June 2021, it is still 14% higher. Compared, then, to the annual expenditure of 2020, the last normal year, equal to 485 euros, now 156 euros more will be paid, +32 percent.
Applause Assoutenti
The very sharp drop in electricity tariffs decided today by Arera is good for Assoutenti, which will lead to record savings on an annual basis of 793 euros per family compared to current prices. The average electricity bill on the protected market, considered for a typical household that consumes 2,700 kWh of energy per year, thus drops from the current 1,434 euros per year to 641 euros, approaching pre-crisis levels, but it is necessary to consider the return of system which, according to the data released today by Arera, will currently weigh around 82 euros per bill per year.
However – analyzes Assoutenti – the new tariffs that will take effect in April are still 14% higher than those in force in the second quarter of 2021, and entailing higher expenditure for families on the protected market equal to 79 euros per year compared to the same period of two years ago.
«We now expect new interventions from the Government on the subject of bills, starting with a reform of system charges, an item that weighs 22% on Italians’ electricity bills and includes taxes that have nothing to do with energy consumption, a real ATM to withdraw money from Italians – says the president Furio Truzzi – We also invite the Government to pay the utmost attention to the extra profits of energy companies, because if astronomical gains are confirmed with the new financial statements of the companies, it will be essential to intervene, in particular on companies controlled by the State, in order to find resources and “return” the money “earned” with the extra profits to families to protect them from possible spikes in electricity and gas prices in the winter period» – concludes Truzzi.