In recent months, a sense of grievance has grown within the gas sector across Spain. The government acted quickly at the start of the process, implementing temporary measures and tax relief aimed at softening the impact of price increases on electricity customers. However, officials did not extend similar tax relief to natural gas, leaving a visible gap in policy response and sparking industry criticism.
Collaborations that include the full gas value chain—transport and distribution networks as well as marketers—and major industrial gas consumers have pressed the government for a coordinated tax reduction within the gas bill. As reported by El Periódico de España on Tuesday, many in the gas sector feel the differential treatment is unjust and view the government’s stance as a missed opportunity to align with pan-European approaches. The central concern is that Brussels tools, especially options to review taxation, were not deployed to cushion the burden on vulnerable consumers who face price shocks from energy markets.
Joan Batalla, president of the Sedigás employers association, commented at the gathering to mark Sedigás’ 48th Annual Meeting. He underscored that revisiting value added tax and the Special Tax on Hydrocarbons would be a timely move to ease the pressure on sensitive households and businesses alike. The industry’s position centers on a call for a VAT reduction on gas consumption from the current 21 percent to 10 percent, mirroring reductions already applied to electricity and water. There is also demand for lowering the Special Hydrocarbon Tax to the minimum level permitted within the European Union.
In recent months, the gas industry has condemned what it calls discriminatory treatment. It has repeatedly called for tax relief on the electricity bill for natural gas consumers and argued for broader tax reductions that would cover gas use directly. The objective is to ease the financial strain on customers as natural gas prices, in tandem with electricity costs, push bills higher across the economy. The sector insists that a VAT cut on gas from 21 percent to 10 percent would have a meaningful impact, as would reductions in hydrocarbon taxes to the EU’s minimum thresholds, thereby leveling the playing field with other energy products.
gas stop
The government has approved a VAT reduction on electricity bills effective since last year, moving from 21 percent toward 10 percent, and has suspended the 7 percent tax on electricity generation. It also seeks to reduce the minimum electricity Special Tax set by Brussels from 5.1 percent to 0.5 percent. These measures were intended to soften the effect of rising electricity prices driven by international market conditions, notably the increases in natural gas costs that feed electricity production. A key tool under consideration is a cap on the price of gas used to generate electricity, intended to curb the upward pressure on electricity bills for millions of homes and businesses. The proposed cap would be a fixed average around 48.8 euros per MWh for the year, compared with levels near 80 euros in previous months, with the aim of stabilizing the broader electricity market.
Any market intervention requires careful calibration, warned the head of Sedigás, who emphasized that reforms must reflect actual costs incurred by combined cycle power plants. He stressed that this is not a subsidy; it is a balancing mechanism intended to ensure fair recognition of genuine costs in the energy system across all players in the gas and power sectors.
Delayed gas increase
The government has capped increases in regulated gas rates, known as TUR, a measure that affects only customers on regulated rates rather than those in the free market. The TUR price, which is reviewed quarterly, cannot exceed five percent in its update window, even though wholesale gas prices have surged. In the most recent period, increases were restricted to around 4.6 percent, leaving room for debate about whether higher increases would be warranted under more volatile market conditions.
Critics argue that the cap is a temporary measure that postpones rather than prevents future price hikes. They urge the government to begin implementing increases gradually from an upcoming April timetable and caution that late actions may complicate the broader recovery plan. Sedigás members also note that the mechanism to recover increments not passed through to millions of customers has not been clearly established, adding to calls for transparent implementation protocols and predictable pricing for households and firms alike.