Few consumers know, but the type of electricity tariff chosen can make all the difference to the bill at the end of the month. DECO PROTeste warns that the decision between a fixed or indexed rate depends on the profile of each user, and the risk they are willing to take to try to save a few euros.
According to the consumer protection organization, fixed tariffs guarantee predictability, while indexed tariffs can offer specific advantages, but involve closely monitoring the evolution of energy prices.
The differences between the two models
According to DECO PROTeste, in a fixed tariff the supplier and the consumer agree on a constant value per kilowatt-hour (kWh), generally valid for 12 months. Therefore, the price of electricity does not change during this period, even if the production cost rises or falls.
In the indexed tariff, the price varies every day, reflecting the behavior of the Iberian Electricity Market (MIBEL), where producers and distributors negotiate energy depending on supply and demand. This means that the final amount paid can fluctuate significantly from month to month.
According to the same publication, “the invoice is calculated based on the average of daily values recorded in the period to which the bill refers”, which makes this type of tariff more unpredictable.
What makes the indexed tariff more expensive?
DECO PROTeste explains that, to the value determined by the market, suppliers add other costs, such as management commissions, network losses, access fees and system operator services. “That’s why it’s not enough to look at the daily price of MIBEL”, warns the association.
The organization estimates that it is necessary to add between 8 and 10 cents per kWh to the wholesale market reference value to obtain a cost comparable to that of fixed tariffs.
The choice depends on the risk profile
When deciding, the most important factor is the degree of risk that the consumer is willing to assume. “Indexed rates should only be contracted by those who follow price developments and are prepared to change rates as soon as prices start to rise”, advises DECO PROTeste.
Fixed tariffs, on the other hand, guarantee stability and facilitate control of the household budget, although they may not reflect possible drops in the price of electricity.
DECO PROTeste advice
Regardless of the choice, she recommends avoiding contracts with loyalty periods, so that it is possible to change suppliers at any time.
In short, the best rate depends more on consumer behavior than on the market. For those who like predictability, the fixed tariff remains the safest option. For those who follow prices and are not afraid of fluctuations, indexing can be a smart way to save, as long as you know when to get out in time.
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