Gas and electricity pricing in Spain: a closer look at market differences
David García’s experience illustrates a broader pattern in Spain’s energy market. Annual gas consumption around 16,000 kilowatt-hours can translate into bills that vary dramatically depending on whether a household is on a free market plan or the regulated tariff. In 2021, García faced an estimated annual gas bill of roughly 1,500 euros under a fixed, market contract. A renewal by a marketer several months later raised the annual price to about 4,000 euros. In the regulated segment, what is known as the Final Facility Fee was about 1,300 euros in the prior year. A comparator from the National Markets and Competition Commission shows the cheapest free-market option from a different marketer at the time was about 2,400 euros. This case is not isolated; it reflects a broader price trend across units of consumption in the country.
The rise in the cost per kilowatt-hour in the free market has been substantial. With increases reported between roughly 95% and 291% for various offers, the tariff landscape has become highly dynamic. A recent analysis by Facua-Consumers at Work examined the latest free-market offers from major marketers including Endesa, Naturgy, Iberdrola, Repsol, CHC Energy and Total Energies. The assessment, conducted on August 8, also referenced the current regulated rate applicable from July 1. The study highlights the ongoing tension between the free and regulated markets in Spain’s natural gas sector.
Natural gas in Spain offers three distinct pricing profiles, determined by annual consumption. Consumers using less than 5,000 kWh per year, those consuming between 5,000 and 15,000 kWh, and those surpassing 15,000 kWh all fall into different brackets. Facua’s comparison focuses on the first two profiles, using the regulated rate as a reference. According to Facua, a household consuming around 400 kWh per month would currently pay about 35.92 euros monthly under the regulated rate. In the free market, monthly bills range roughly from 63.85 euros to 121.65 euros, representing a doubling to more than a quadrupling of costs. For a profile consuming about 800 kWh each month, the regulated rate could equate to roughly 67.76 euros per month, while the free market might yield bills from 123.60 euros to 251.10 euros, depending on the tariff and the applicable Final Tariff if consumption falls within the 5,000 to 15,000 kWh annual band. The difference is clear: free-market users can pay substantially more, depending on the contract terms and quarterly adjustments tied to market dynamics.
The persistent price gap between the free and regulated markets mirrors the structure of the tariffs themselves. Free-market rates are responsive to contract terms agreed between gas marketers and customers, allowing for fluctuations tied to international price movements. In contrast, the regulated rate is governed by government rules that are reviewed quarterly—January, April, July, and early October—based on the evolution of gas prices in global markets. Since September of the previous year, in response to world events such as the war in Ukraine, the regulator capped the pass-through of this cost so that only up to 15% would be reflected in quarterly reviews through the end of the year. This cap was intended to prevent steep, immediate increases for consumers. Meanwhile, free-market providers have some incentive to widen margins to hedge against potential future price spikes during the coming winter.
Despite these complexities, a substantial majority of natural gas customers in Spain have chosen the free market. The latest CNMC report tracks consumer shares through the last quarter of 2021, showing 7.9 million customers in total and that about 81% participate in the free market. Over the final three months of that year, the regulated market shed 23,493 customers, while the free market gained 20,384 customers. This shift highlights a significant consumer trend toward price discovery and choice, even as confusion persists among many customers about which rates apply to which suppliers. The National Markets and Competition Commission has repeatedly emphasized that a set of reference marketers exists for both electricity and gas. These marketers belong to large corporate groups that also operate in the free market, which can blur lines for some customers. In Spain, the regulated marketers include Baser (from the EDP group), Energía XXI (from Endesa), Regulated Marketer Gas & Power (from Naturgy), and Cur Energía Último Recurso (from Iberdrola).
Overall, the energy market in Spain presents a dynamic landscape where price differences between regulated and free offerings are pronounced and regularly updated. Consumers evaluating their gas and electricity options should compare not only headline rates but also the total annual cost, including potential tariffs like the Final Facility Fee and any quarterly adjustments. A careful comparison helps identify where real savings exist and where the perceived convenience of set tariffs might hide greater long-term expenses. The CNMC and consumer groups continue to urge clarity from marketers and greater consumer awareness of how tariffs are structured, renewed, or adjusted.
Notes based on CNMC data and Facua analyses are used for contextual understanding of market movement and consumer impact. They offer a window into how price signals and regulation interact in a country with a large base of energy customers and multiple market players. The information reflects the situation as reported and analyzed in the cited sources and remains relevant for readers seeking to understand the basics of gas pricing and market structure in Spain. Citations: CNMC market data and Facua comparator reports.
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