Indexed tariffs are the cheapest electricity offers for families, but they offer responsiveness.

Indexed tariffs are currently the most competitive electricity offer for households regardless of consumption, offering savings of 20% compared to a regulated tariff, but consumers must be informed and able to respond, the regulator warns.

Indexed tariffs are proposals calculated based on the simple average price of energy charged on the wholesale market, relative to the month in which the domestic consumer consumed it. That is, the electricity tariff is calculated monthly based on this monthly guide.

At the same time, the market has dynamic tariffs in which the energy component is calculated on an hourly basis, which requires the client to closely monitor price developments observed in the spot markets (OMIE/MIBGAS) to avoid risk. large price fluctuations throughout the day, which could be caused, for example, by changes in renewable energy production.

The Energy Services Regulatory Authority (ERSE) states that “in order for a customer to benefit from this type of contract, it is important to be well informed about price dynamics in electricity markets to be able to react and change consumption.” quickly over time.”

Lower prices in wholesale energy markets have made indexed and dynamic tariffs more attractive and encouraged consumers to choose these solutions offered by a number of companies.

In the ERSE bulletin for the first quarter, the commercial offer of electricity for a couple without children with the lowest monthly bill is listed from Eni Plenitude (Tarifa Tendência) with a cost of 31.34 euros/month, corresponding to a discount of 17% and a monthly saving of 6.33 euros compared to regulated tariff.

Also for families with higher consumption – couples with two and four children – the indexed tariffs are the cheapest: as in Ibelectra (Family Solution), with a cost of 77.23 euros per month, corresponding to a 19% discount and a monthly saving of 18.47 euros compared to the regulated tariff in the first case and the cost is 165.59 euros/month, which corresponds to a 20% discount and monthly savings of 42.62 euros, in the second.

In the first quarter of 2024, the difference between the best offer and the offer of the regulated market (tariffs determined annually by ERSE) corresponds to 6.33 euros/month, 18.47 euros/month and 42.62 euros/month for consumer types 1, 2 and 3 respectively for all commercial offers.

As for dynamic tariffs, ERSE does not carry out modeling as they vary greatly depending on each consumer’s hourly consumption profile, but the regulator plans to launch a bid comparison tool soon.

Currently EDP Comercial, Endesa, Iberdrola and Goldenergy offer dynamic tariffs. Market regime suppliers, which supply more than 200,000 consumers and, if their respective consumption facilities are equipped with smart meters, must also provide dynamically priced electricity contracts, with prices changing from hour to hour, he explains in Lusa’s response to the regulator.

When switching to this type of tariff, the consumer must keep in mind the problem of unpredictability – if the price trend changes, this will immediately be reflected in the bill.

In this way, “dynamic pricing contracts encourage greater consumer participation in managing their energy bills by responding to price signals, encouraging better visibility into electricity consumption and improving energy efficiency,” he tells ERSE.

Consumers have the right to change suppliers without any associated costs or any maximum number of changes.

A change of supplier also does not entail changes in equipment (for example, meters), and the maximum period for changes to come into force is three weeks.