The new Royal Decree Law 18/2022 introduces changes to the electricity Social Bonus effective 20 October 2022. For consumers who previously received the Social Bonus, their percentage discounts have increased as have the limits of energy consumption entitled to a discount (additional 15%).
What is the Social Bonus?
The Social Bonus is a significant discount on electricity bills. It is regulated by the government and aims to protect households considered vulnerable or severely vulnerable on account of their socio-economic conditions. Being a beneficiary of the Social Bonus also implies receiving the Social Thermal Bonus as defined by the Government.
Who can benefit from the new Social Rate?
To benefit from the Social Bonus, it is essential for the recipient to be a natural person and have contracted the PVPC electricity rate and a power equal to or less than 10 kilowatts at their primary residence.
Applicants can apply for the Social Bonus if their income does not exceed certain income levels, if they are a pensioner, large family or recipient of the minimum wage, as detailed below.
What are the requirements to be considered vulnerable or severely vulnerable?
Those who are holders of a regulated tariff contract (PVPC) and meet at least four of the following conditions are considered to be vulnerable customers:
1. Annual income less than or equal to the limits established according to the IPREM (Public Indicator of Multiple Effect Income) in 14 payments:
- 1.5 times the IPREM*: If he/she is not part of a cohabitation unit or there are no dependant minors.
- 0.3 times the IPREM for each additional member of legal age.
- 0.5 times the IPREM for each minor in the cohabitation unit.
*IPREM 14 payments valid for 2023: €8,400.
For example, to be entitled to the Social Bonus as a vulnerable consumer in the case of a couple with two children, the maximum income is €23,520.
Units of coexistence consist of the people who reside at the same address and who are connected to each other:
- By marriage or as a domestic partnership.
- Related up to the second degree of consanguinity/affinity: Children, spouse, parents, parents-in-law, sons-in-law and daughters-in-law, grandparents, siblings, grandchildren and brothers/sisters-in-law.
- By adoption, and other persons with who you live by virtue of guardianship for the purpose of adoption or permanent family fostering.
- In no case may the same person be part of two or more cohabitation units.
All these thresholds will be increased by 0.5 times the IPREM if any of the following requirements are met:
- If any member of the cohabitation unit has a recognised disability equal to or greater than 33%, has been a victim of gender violence or has been a victim of terrorism.
- If a member of the cohabitation unit is in a situation of recognised grade 2 or 3 dependency.
- If it can be accredited that the cohabitation unit consists of a single parent and at least one minor (single-parent families).
2. Pensioners in the Social Security System (retirement or permanent disability): applicants (or in case of a cohabitation unit, all its members in receipt of income) receive the minimum pension (for retirement or permanent disability). In addition, if they have another source of income apart from their pension, the annual value of this income must not exceed €500.
3. Large families: all, without exceptions, that present a valid large family accreditation.
4. Recipients of the minimum wage: if the consumer or any member of the cohabitation unit is a beneficiary of the minimum wage in accordance with the provisions of Law 19/2021, of 20 December, establishing the minimum wage.
From 20 October 2022 and until 31 December 2023, beneficiaries of the Social Bonus considered vulnerable will receive extraordinary discounts on energy (subject to the consumption threshold set out below) and power in their bill of up to 65%.
Severely vulnerable customers
Those who are holders of a regulated tariff contract (PVPC) and meet at least three of the following conditions are considered to be severely vulnerable customers:
- Income: receive an annual income less than or equal to 50% of the income thresholds established to be considered a vulnerable customer, including, where appropriate, the increase set out for cases in which "special circumstances" occur.
- Pensioners in the Social Security System (retirement or permanent disability): all members of the family unit are Social Security pensioners, receive the minimum pension (for retirement or permanent disability) and have an annual income less than or equal to 1 time the IPREM (€8,400).
- Officially registered large family: those whose annual income is less than 2 times the IPREM (€16,800).
- Minimum wage: If the customer or any member of their cohabitation unit is a recipient of the minimum, the income criteria defined in point one will be applied.
From 20 October 2022 and until 31 December 2023, beneficiaries of the Social Bonus considered severely vulnerable will receive extraordinary discounts on energy (subject to the consumption threshold set out below) and power in their bill of up to 80%.
Where they meet the requirements, severely vulnerable customers are entitled to a 40% discount on their bill, with limits to annual consumption. They currently benefit from an extraordinary discount of 80% which is valid until 31 December 2023.
Severely vulnerable customers at risk of social exclusion
This special category encompasses those who meet the following two conditions:
- They are considered severely vulnerable customers (see above).
- They receive support from the social services of a regional or local administration co-financing at least 50% of their electricity bills.
In these circumstances, the beneficiary of the Social Bonus will enjoy a discount on the electricity bill of 80% (severely vulnerable consumer) and will be considered an essential customer for the purposes of supply cuts.
Other vulnerable or severely vulnerable customers deemed essential for the purposes of supply cuts
In addition to the above, vulnerable or severely vulnerable consumers who meet the following conditions and are accredited in a report from Social Services, will also be considered essential for the purposes of supply cuts:
- Cohabitation unit with at least one child under the age of 16
- Any member of the cohabitation unit has a recognised disability equal to or greater than 33%.
- Any member of the cohabitation unit is in a situation of recognised grade 2 or 3 dependency.
New electricity social bonus: energy justice bonus
The government has approved the 40% discount on the regulated electricity tariff (known as the PVPC) for low-income households that are particularly affected by the energy crisis.
This new temporary bonus will be applied until 31 December 2023 and will not be compatible with the Thermal Social Bonus.
Households whose income is 1.5 to 2 times the IPREM in 14 paymentswill be eligible, with the multipliers applied to the conventional Social Bonus.