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Understanding your electricity bill

Understanding your electricity bill is important for knowing what you are paying for and for making decisions on how to improve the energy efficiency of your household, what you spend, and how to tailor your consumption to your needs.

Despite this, many people have no idea. The 2019 CNMC Household Panel on electricity and gas revealed that 22% of households, i.e., more than two in ten, do not know how much power is included in their energy contract, even though this is clearly printed on each bill. What’s more, a third of all households do not know which rate they have and three out of ten consumers with hourly discrimination rate contracts do not alter their habits so as to consume power when it is cheapest.

That is why having a proper understanding of your electricity bill is so important. You know how much you are paying, what you are paying for, who to contact to get answers to questions and complaints and you can analyse how you are using your energy. Allow us to explain:

Bill Summary

The first page of the bill contains basic information so that you can quickly identify the most important variables:

Details of the electricity retailer

The top of the bill gives details of the retailer, that is, the company that sells the electricity to you. This is the company you need to contact to make changes to the service. If you want to know the differences between a retailer and a distributor, this content will help: Retailers, distributors and electricity markets .

Bill details

This is all the information needed to identify the bill. You will need this information if you want to query or make a complaint regarding the bill. This information has two important parts:

  • The bill number: The bill number (tax ID) is the reference number for locating the bill.
  • Dates: There are several dates
    • The date on which the bill is issued.
    • Billing period: the period of time covered by the bill.
    • Payment date: In this case there are two possibilities. The first, the most common, is the date on which the money will deducted from your account if you pay by direct debit. The second is the due date by which the bill must be paid if you do not have direct debit.

Name and address of the bill's recipient

This shows the name and surname(s) of the contract holder and the postal address.

Bill summary

The first page shows the amount payable for each item. This is broken down in detail later on.

  • Contracted power: A fixed amount payable daily for the contracted power, measured in kW. This depends on the number of electrical appliances used in the home at the same time, so it is important to have enough to meet your needs, but without paying too much.
  • Consumption: This is the variable part of the bill. What you pay depends on how much electricity you use and the price of that electricity. It is measured in euros per kWh.
  • Discounts: If you are entitled to any discounts on the fixed amount (power) and the variable amount (consumption), these are listed and broken down
"The contracted power is the fixed amount you pay for power each day and is measured in kW. The level you should choose depends on the number of electrical appliances that you use in your home at the same time."
  • Electricity tax: This is currently established by the Ministry for the Ecological Transition and the Demographic Challenge and is set at 5.11% of the amount billed for power and consumption.
  • Other items: This is usually meter rental, for which a daily charge is included in your bill.
  • Indirect taxes: VAT at 21% is added to the total bill, with the exception of the Canary Islands where the indirect tax is the IGIC. 
  • These items make up your electricity bill but in many cases there are other items such as maintenance services, which are charged separately. The total amount payable is the sum total of all of these.
  • Your selected payment method also appears on the bill, such as your account number if you pay by direct debit or the bill identification code if you prefer to pay at the bank.

Itemised Bill

Here, there are two groups of important information: one that identifies the supply and the other the financial information:

Contract data:

These include the following:

Identification of the owner and the point of supply: The contract holder’s name and surname(s) and tax ID number (for individuals) or Tax ID Code (for legal persons). The address shown here may be different from the one on the first page. This is the supply point address, which may differ from the delivery and billing address.

Product contracted: The rate applicable to the contract

Power: The kW of power that are contracted at the current rate.

Retailer and distributor: It is important to distinguish between these companies in order to clarify who is responsible for faults, for example.

Contract number: The reference number assigned by your retailer.

CUPS: CUPS stands for Universal Supply Point Code (Código Universal de Punto de Suministro, in Spanish), a code with 20 to 22 alphanumeric digits starting with ES. It is unique and is used to identify your contract with your current operator, or if you want to make any changes.

Contract end date: This is included for information purposes and does not require any action on the part of the consumer since it is automatically renewed.

Financial data:

Previous and current meter readings: Shows how much electricity you used during the billing period. It is important to know whether the reading is real or an estimate. If it is an estimate, it will have been calculated based on your normal consumption, but it will eventually be adjusted (upward or downward).

"It is important to know whether the reading is real or an estimate. If it is an estimate, it will have been calculated based on your normal consumption, but it will eventually be adjusted"

Consumption: The bill not only shows the difference between the meter readings at the start and the end of the billing period, but there are also two other measurements to help you to analyse your energy use.

  • Average daily consumption
  • Graph with the evolution of consumption: You can compare your consumption over the previous 14 months with the months with similar habits and weather conditions last year, giving you an idea of why you are spending what you do.

 Where your money goes:

For information purposes, you can also see a breakdown of the amount you are paying:

Regulated costs: These include incentives for renewable energy, transportation and distribution costs (construction and maintenance of the network) and the tariff deficit.

Taxes applied

Energy production: The income really received by the company.

Lastly, all bills include the company’s contact information, which is very important when it comes to queries and complaints.

 

Are you an Endesa customer? Well, that’s better still, because this content explains exactly how to understand your Endesa electricity bill.

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