Portugal’s gas and electricity the most expensive in Europe

In terms of purchasing power, Portugal has the most expensive electricity and gas in Europe, according to Eurostat.

Looking at the actual rates paid including tax, Portugal’s households paid prices for electricity that placed the country in seventh place, way above the EU and the Eurozone averages, in a table headed by Denmark and Germany whose consumers are better able to afford the prices charged.

For domestic gas, Portugal paid the second highest actual price in Europe, just behind Sweden and followed by Spain and Italy.

As Portugal’s wage levels are near the bottom of the European league, in purchasing power parity, Eurostat reports that Portugal’s consumers paid the highest gas prices in Europe, with Spain, Greece and Sweden close behind.

The electricity price in Portugal, adjusted for purchasing power, also is the highest in the EU, followed by Germany, Spain and then Romania.

According to Eurostat, the average electricity prices rose 2.4% in the EU last year, while natural gas fell 1.7%.

In Portugal’s case, the energy regulator reported that for 2015 the electricity price went up an average of 3.3%, followed by a rise of 2.5% in 2016.

For natural gas, the regulator in Portugal approved a 2015 decrease of 7.3% and in 2016 the regulator has proposed a further drop of 18.5%. Consumers are still waiting.

The head of Portuguese electricity company EDP, António Mexia, points out that many consumers are on the low ‘social tariff’ and that the tax burden on electricity is high.

In fact, EDP recently has been fined €7.5 million for its lack of effort in transferring its poorest customers onto the ‘social tariff’, while continuing to moan that the government should refund EDP the difference between the social tariff and the full tariff.

Mexia, who earned €2.1 million in 2015, had another go at justifying EDP’s stiff electricity charges; "The problem is not in the price of electricity, the problem is in purchasing power. ... The price for households in Portugal is in line with the European price, especially if we consider that there is a higher tax in Portugal the European average."

Eurostat did confirm that the weight of taxes and fees added to the price of domestic electricity in Portugal is the third highest in the EU at 50%, after Denmark at 69% and Germany at 52% - all of which are above the European average of 33%.