The outlook for energy prices remains sensitive to gas markets this year. Electricity costs are closely tied to the price of gas, and when gas spikes, electricity tends to rise as well. In many markets, the price that sets hourly electricity rates comes from the most expensive available technology, a typical characteristic of marginal pricing. A sharp rise in gas pressures over the past year and a half, driven in part by geopolitical tensions, has been a major driver of higher electricity costs.
The wholesale electricity market closed 2022 at an all‑time high, averaging 209.94 euros per megawatt hour (MWh), roughly double the 2021 average of 111.95 euros per MWh. The final month was relatively cheap compared with the preceding weeks, dipping to around 50 euros per MWh due to ample renewable generation, lower gas demand, and moderate winter temperatures. Looking ahead to 2023, some analysts predicted a continuation of the upward trend. For example, electricity market expert Francisco Valverde of Menta Energía projected an average of about 195.7 euros per MWh for 2023.
How much will natural gas increase in 2023?
A government gas price cap has helped stabilize electricity costs by targeting around 40 euros per MWh during peak periods mid-year, according to industry observers. While the exact impact varies by market, the cap provides a degree of predictability that many consumers have relied on for the past six months. Still, market behavior without such a mechanism remains uncertain. The Iberian exception widened the price gap versus neighboring countries in mid‑year; since June, the wholesale average in Spain stood near 80 euros, while France, Italy, and Germany posted higher averages around 320, 354, and 282 euros, respectively. In the first half of the year, prices ran near 200 euros in several countries. The gas cap’s scheduled adjustments begin in January, increasing by roughly 5 euros per MWh each month, with a potential end date if conditions change.
How will 2023 be for mortgagees?
Beyond energy alone, the total bill is shaped by taxes and regulated costs that governments adjust. Forecasts for 2023 anticipated continued reductions in certain charges, with overall transmission and distribution network costs expected to ease by roughly 1.05% versus 2022. In addition, the tariff gap subsidies and renewable energy premiums were slashed, yielding further relief for the tariff components that residents pay.
How will wages and employment develop in 2023?
The regulated electricity tariff, often called the Voluntary Price for Small Consumers (VPSC), tracks wholesale electricity costs directly. In recent months, small consumers faced rising bills as wholesale prices moved higher. By contrast, the free rate, which is negotiated between the marketer and the customer, can differ significantly from one household to another. In the past year, the free rate was commonly cheaper for many larger users due to fixed‑portion discounts, while the regulated rate reflected the broader wholesale trend. Data from Caixabank, based on current records, show October bills averaging around 58 euros for the regulated rate and about 80 euros for the free rate.
How high will the shopping cart go in 2023?
Consumers are advised to compare offers based on consumption. The National Markets and Competition Commission (CNMC) provides a comparator accessible to all households. The government also signaled a shift in how the regulated tariff is calculated this year. The aim is not to simply lower the invoice but to stabilize it. The formula would blend current daily market prices with a forward reference to compute final bills, gradually increasing the weight of the forward reference: 25% in 2023, 40% in 2024, and 55% in 2025. Government estimates suggest that in peak price years, this method could reduce payments, while in low-price years it could raise them slightly. For example, when wholesale prices averaged around 111.9 euros in 2021, the new method would have reduced costs by about 20%, whereas in high-price years it could result in modest increases.
How much will transportation cost in 2023?
The government outlined contingency measures and upcoming product introductions planned to take effect from December 1, though some items were delayed. Proactive steps include neighborhood‑level consumption estimates to help households compare usage and find savings, plus a guide outlining the impact of any gas price cap on bills and what consumers would pay without it.
Changes are expected to align with the rollout of the new PVPC and require approvals from the national competition regulator before final adoption. Government sources have indicated that timelines depend on regulatory reviews and committee approvals, with a final date yet to be confirmed.