Thousands of electricity customers from Galp, Iberdrola and some other smaller companies are being surprised by the invoices with almost twice what they usually pay habitually, simply because these companies have started to apply the so-called “MIBEL adjustment mechanism”. It may have this name or something similar. A lady who contacted me mentioned that she has just received an electricity bill of 240 euros because of this adjustment mechanism. Twice as usual.If you haven’t been affected by this new line on your bill yet, read this article, because it might be coming soon, so you won’t be completely taken by surprise.
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What can and should you do?
First of all, you should understand – to avoid misunderstandings – that this additional line it’s perfectly cool. Companies can apply this adjustment mechanism to the price they charge you on your invoice. It is provided for by law. This situation may apply to all contracts that renew (have a duration of one year) after April 26, 2022 or that have been made again after that date. It also includes all contracts that are indexed to the OMIE (ie contracts that change in price every month at your option).
What is the MIBEL Tuning Engine?
The situation is as follows: electricity is “made” in several ways (dams, wind, solar and gas). And gas is at completely absurd prices. Therefore, many companies cannot bear to continue to sell you electricity at the price you contracted for before the war. Thus, the government allowed companies to keep prices as they are in their contract, but pass on to customers what they are supposed to be overpaying each time they buy electricity to sell you. In this process, the value is not passed on completely to customers, it has a 10 or 15% discount. This new line – which adds to the “normal” price of kWh – is the so-called “MIBEL adjustment mechanism”. plus 19 cents per kWh in addition to the normal kWh price. Now, this means that the invoice, in some cases, is practically double the price. This mechanism is essential for many companies because – otherwise – they would go bankrupt. If you had a grocery store and you bought potatoes at 5 euros at the supply market and if you sold them for 1 euro, you would end up having to close your doors. It’s the same thing. Iberdrola has also started to apply this mechanism and other companies too. Endesa guaranteed that it would not change prices until December, Goldenergy – as far as I know – has not yet changed prices and EDP Comercial has not changed either. Therefore, the first conclusion is: the companies will only apply this “adjustment fee” if they really need or want to. There are (still) alternatives in the liberalized market. Read more: Use smart meters to save on electricity
The problem here is not the legality of the measure, but the information to customers. As companies are not obliged to include this mechanism (they may decide to assume the losses for reasons of competition or marketing), there are companies that are applying the mechanism and others that are not (yet). ERSE told me that the companies were “obliged” to inform customers 30 days in advance that they were going to change prices, but the companies I spoke to assure me that they don’t have to do that because they’re just enforcing the law, they’re not changing their pricing. That way, you’ll only know if you’re going to pay double, after the invoice appears. This is terrible for consumers. Also read: What’s the best way to save on electricity?
What are the alternatives?
If you are being affected and want to run away now, or want to run away for prevention, you can switch to a cheaper company than the regulated one that promise not to apply this adjustment mechanism or you always have the option – for now – of the regulated market that is a company: SU Electricidade. Just search on Google.According to the government order, for now, SU Electricidade will not include the MIBEL adjustment mechanism in the invoice. It is what we can call a “safe haven” of electricity in this very troubled phase. The important thing is to be aware and move. Don’t wait to see what happens. Every invoice you receive with this mechanism active is a few tens of euros less that are left in your pocket and that you need for other things that are more important to you. Call their customer support and ask if they will apply this mechanism or not. And then decide what to do. There are still alternatives. But be quick. Also read: What is the impact of lowering VAT on electricity on my bill? Pedro Andersson was born in 1973 and fell in love with journalism as a teenager, at Rádio Clube da Covilhã. He graduated in Social Communication at the University of Beira Interior and began his professional career at TSF. In 2000, he was invited to be one of the founding journalists of SIC Notícias. Currently, he continues at SIC, as a coordinating journalist, and since 2011 he has been responsible for the “Savings Accounts” section, dedicated to personal finance. He tries to bring the reality of everyday life to the reports he makes. Tags #electricity, #adjustment mechanism