The fourth vice president and Minister of Ecological Transformation, Teresa Ribera, has been saying for months that the reform of the electricity tariff was going to lower the price of electricity. But it turned out to be a lie. Compared to May of last year, when activity was practically non-existent due to Covid, prices grew 44 percent.
Why did the minister slip in? The blame is on CO2, which more than doubled. The electricity market is marginalized due to the regulations of the European Union, which means that the most expensive energy determines the price of the pool for the rest. So gas, with 50 euros in taxes per ton of CO2, makes the others more expensive.
During the previous legislature, the Nadal brothers also introduced mechanisms in the regulated market so that prices reflected demand, which accentuated the decreases, but also the increases.
As an alternative, consumers can opt for the liberalized rates, which are offered by electricity companies in packages with closed prices, but they tend to be more expensive than regulated rates, because they include insurance for price variations. So there is no way to escape the highs that will come in the next few months.
Ribera has created time slots for citizens to take advantage of off-peak moments, but not even with that they get a discount. They will tell me how to avoid turning on the air conditioning in the hottest periods of the day. But the bad news does not end here. The cost of CO2 will continue to rise. Analysts predict that it will double to 100 euros per ton, which will make the electricity bill even more expensive.
Sánchez and Ribera are victims of the climate change boomerang they promote
To make matters worse, the minister invented a Royal Decree, which she now intends to validate in Parliament as a Law, by which dirty energies, such as hydrocarbons, should pay for clean energies, such as renewables.
That means that fuels, which are at maximum due to OPEC production cuts, will rise even more, because the oil or gas companies will pass these rates on to users. The government tried on Tuesday to fix the mess, transferring part of the cost, around 1,000 million, to the electricity companies. A patch policy that only adds to the confusion .
The minister intends to reduce the impact through a populist measure, that hydroelectric and nuclear plants founded before 2005 stop receiving the so-called dividends fallen from the sky or from carbon, because they have already amortized their costs.
The decision, which hits Endesa and Iberdrola particularly hard, sparked a barrage of protests from the sector. The Nuclear Forum ensures that its facilities pay “confiscatory” taxes equivalent to half of the income received and, in addition, they must invest 3,000 million in the coming years to comply with environmental regulations. The solution ? They threaten to close them, although this is impossible to do without administrative permission.
Europe delays the disbursement of funds to Spain because it lacks a de-escalation plan
The result is a kind of pandemonium between electricity and oil companies, with complex legislation that is difficult for the citizen to understand, to which the Government has sold Aldous Huxley’s Happy World, with renewable energy and recyclable materials, which will be expensive to achieve. .
The reasoning is simple. If 2 out of every 3 euros for the sale of a liter of gasoline or diesel reverts in the form of taxes to the State, what will happen when the majority of the automobile fleet is electric. It is obvious that the purchase of the electric car will go from being subsidized to being taxed with new taxes to compensate for the tax loss.
Electricity in Spain bears a VAT of 21 percent, almost as if it were a luxury product, when in Europe it has reduced rates of less than half and then Sánchez and Ribera criticize the energy poverty of thousands of citizens. If they really believed what they say, they should start by cleaning up the toll bill and reducing VAT. But the pace of public spending does not allow them to touch them.
On the contrary, the Budget for this exercise includes taxes on plastics or sugary drinks to contribute to the ecological transformation. These are just a sample of what remains to come. In this exercise, the increase in the gas oil tax or the registration tax , which was overthrown in Congress, was parked under pressure from the PNV . But the adaptation to the directives of the European Union will force to assume a lot of taxes related to the mobility, like the kerosene of the planes.
Sánchez and Ribera have made an effort in recent years to defend the need to accelerate the fight against climate change. The disappearance of cars with diesel or gasoline was ahead of 2040 and also the deadlines contained in the National Energy and Climate Plan (Pniec) to achieve carbon neutrality in 2050.
But they forgot to launch a public awareness campaign in parallel about the adverse effects that these measures will have on their pockets. We have already talked about the contradiction of spending hundreds of millions to subsidize the purchase of pure electric cars when the national industry is the champion in the production of diesel vehicles and the effect it will have in terms of employment.
Now Sánchez and Ribera are victims of the boomerang that they have helped to promote without thinking about the adverse consequences. Get used to it, the prices of electricity will continue to rise, not downward as they want us to believe, as well as fuel prices. Mobility will become more expensive, it will not become cheaper to comply with the environment.
Unfortunately, they are not the only taxes on the rise. The Minister of Finance, María Jesús Montero, put into the Anti-Fraud Law an increase in the tax bases for real estate transactions from parents to children, which from now on will be governed by the market price, instead of the IBI, much lower. And on top of that, he criticizes that Spanish taxation is eight points below the European one.
To have a realistic view of the economic outlook, the employment data released this week for the month of May, with the increase of 212,000 contributors to Social Security, are optimistic. They begin to reflect the exit of the pandemic.
The Government recognizes, as published by elEconomista, that one in three people in Erte, around 180,000, will increase the unemployment figures, to which should be added a similar number of self-employed, who requested the cessation of their activities. That will add about 360,000 inactive at the end of this year or the beginning of next, two more points of unemployment, to 4.2 million.
The Minister of Social Security, José Luis Escrivá, introduced after a big fight with the president of the employer, Antonio Garamendi, incentives to accelerate the departure of the Ertes.
But the extension of the closures inside bars and restaurants approved by the inter-territorial commission, led by the Minister of Health, Carolina Darias, could derail their plans. The return to normalcy will suffer setbacks, as happened this week with the maintenance of the UK recommendation not to travel to Spain.
In parallel, European funds, the balsam of beasts to compensate for job losses and activity, are delayed. The second vice president, Nadia Calviño, admits that the first disbursements will not be until September, half a year later than expected. Europe mistrusts the Spanish plans, as was seen in the presentation of the Spring Report, where, without citing Spain, the Commissioner for the Economy, Paolo Gentilioni, requested a realistic sanitation plan for the most indebted countries. Green and with handles.
Among other things, we continue without a plan to rationalize public spending, despite the fact that it is already known that the escape clause to skip the deficit will disappear in 2023. The Government, instead of presenting a de-escalation plan in the medium or long term to face the multiple imbalances that the return to normality will cause, keep thinking only of increasing spending or covering increases such as those of light with patches, which do not solve the problem.
Leon Cooper was born and raised in Vancouver. As a Reporter for TheBioChronicle, Leon has contributed to several online publications including Dream House Publications and Granville Magazine. In regards to academics, Leon has got a Post Graduation Degree in Department Of Archaeology from The University Of British Columbia. As a Reporter for TheBioChronicle Leon Covers International Topics.