End of the protected market: who will pay more and who less for electricity bills

There are two weeks to go until the end of greater protection for electricity bills. From 1 July, in fact, the gradual protection service will be triggered, the temporary mechanism put in place to facilitate the complete liberalisation of the electricity market and which will expire in 2027. The transition to the new regime will concern, as is known, all non-vulnerable customers who, on 30 June, will still be subject to greater protection and will not have chosen an operator in the free market in the meantime. For vulnerable customers - i.e. those over 75, recipients of social bonuses for economic or physical hardship, beneficiaries of Law 104 on disabilities, and also users of non-interconnected minor islands or emergency housing facilities - nothing will change and they will continue to be provided with the same service.

But what happens in terms of prices to those who switch to the new regime? Will it be more or less expensive than greater protection? The price of the graduated protection service will be composed of a charge for energy, based on the final values of the Pun (the single national price) and including fees to cover other supply and marketing costs. The price paid by end customers will, however, also depend on the level of the parameters offered by each operator of the graduated protection service in each territorial area in which the service is assigned. The final costs will therefore only be known when the new mechanism becomes fully operational.

For now, what is certain is that compared to the current costs of the greater protection, the changeover will entail an annual saving that Arera president Stefano Besseghini, in a recent video interview with Il Sole 24Ore.com, quantifies at around 100 euros, after recalling that the economic conditions of the Stg envisage, as mentioned, two price components. "A first component to cover the costs of energy supply and another (the so-called gamma parameter) defined on the basis of the offers formulated by the operators. We are putting our hands on the first component, which is worth 58 euros in greater protection and which we will revise because the service mechanism has changed. While it will not undergo any particular changes. the other component, the gamma parameter, which is currently estimated at -73 euro'.

As for the prices on the free market, according to the latest survey carried out by the Authority and the results of which were reported by Besseghini in one of the last hearings in Parliament, in the second half of 2023 the average price of the offers on the free electricity market had exceeded that of the greater protection service. According to Arera's snapshot, in the second half of 2023 the differential between the two types of offer had "returned very significantly in favour of protection" with the total average price recorded on the protected market which, in the second half of 2023, was 28.11 c€/kWh, against 39.18 c€/kWh on the free market (+39.4%). At the same time, compared to the beginning of the year, prices in the free market had risen by 8.5%, those in the protected market saw a fall of -48.5%.

In the second half of 2023, the average final price for domestic customers on the free market was then 36.62 c€/kWh. The two most significant classes, those of customers consuming 1,000 to 2,500 kWh/year and 2,500 to 5,000 kWh/year, had recorded a price of 36.35 and 33.64 c€/kWh respectively. The same dynamics over the whole year as well: the average price recorded in 2023 was 38.78 c€/kWh, up from that of 2022 (36.43 c€/kWh).