There has been a lot of talk in recent months about the Social Rate for electricity, the electricity rate regulated by the Government that offers discounts of 25% to 40% for lower income consumers (and large families).
But what about gas? Is there anything like a Social Rate for gas? More or less. It is called Thermal Social Bonus and its purpose is to help meet heating, hot water and cooking expenses.
However, financial aid (electricity and thermal Social Bonus) must not be confused with regulated rates. The intention here is to remind you of the difference between the free market and the regulated market. They are not a flat rate either (but rather a discount to help you pay less if you meet certain requirements.
- In electricity, the regulated rate is called PVPC (Volunteer Price for the Small Consumer).
- In gas, the regulated rate is called Last Resort Tariff (TUR).
What is the gas TUR
It is a rate for natural gas regulated by the National Commission on Markets and Competition (CNMC) and the Ministry of Industry:
- There is a single rate throughout Spain: no matter where you live, the conditions are the same.
- The TUR specifies the maximum and minimum prices that gas suppliers can charge you.
- This rate cannot compete with prices on the open market for gas: as with electricity, for gas there is also an open market and a regulated market. The TUR is the regulated market rate.
Type of TUR
Natural gas users have the option of choosing between two last resort rates: one aimed at small consumers (TUR1) and the other designed for those with higher gas consumption needs (TUR2).
- TUR1: intended for those with annual consumption that is equal to or less than 5,000 kWh of natural gas, with a supply pressure equal to or lower than 4 bars.
- TUR2: designed for consumers of between 5,000 and 50,000 kWh of natural gas per year, with a supply pressure equal to or lower than 4 bars.
In general, domestic consumers are connected to a natural gas network with 4-bar pressure, and their consumption is nowhere near 50,000 kWh. To give you an idea: a Spanish household that uses gas for hot water and heating has an annual consumption of around 9,000 kWh. On the other hand, if the heating system is not powered by natural gas, consumption drops to 3,000 or 4,000 kWh per year.
Under TUR1, the fixed component of your bill (what you pay every month regardless of your consumption) is more economical, while the variable component (the gas you consume) is higher.
Under TUR2, the fixed component of the bill is higher, but the variable component is more economical.
Prices fluctuate on a quarterly basis depending on the cost of natural gas in the market auctions.
Who can buy gas at the TUR rate?
To be eligible for the TUR you must consume less than 50,000 kWh of natural gas per year. This is a very high figure for domestic consumers, representing 5 times more than what an average household with gas-powered heat and hot water usually uses.
Is TUR1 or TUR2 better for you? The answer to this question is that is doesn’t matter, since you cannot choose this yourself. If you consume less than 5,000 kWh in a year, you will be charged TUR1, and if you exceed this figure, you will be bumped up to TUR2.
Difference from ‘bono social’ discounted rate
Although the easiest way to explain the Last Resort Rate for gas is by comparing it to the Social Rebate for electricity, the fact is, there are some significant differences:
- The electricity Social Rate is for those with limited resources (and large families), whereas anyone who does not surpass the annual consumption limit is eligible for the TUR.
- The Social Rate applies a discount on the regulated PVPC electricity rate, whereas the TUR is the rate itself, with its own prices.
- The Social Rate would be more comparable with the Thermal Social Bonus. Both are designed to help people in need, although they are different: with respect to electricity, it is a discount that applies to all bills; the thermal bonus is a single annual payment that varies depending on where you live.