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When Profits Of The Whole Month Go To Pay Electricity Bill

The disproportionate rise in the price of electricity has added more pressure – if possible – to hundreds of small businesses of the self-employed and SMEs whose survival had already been at risk for a year and a half after the closings of spring 2020 and the long and slow subsequent recovery.

This situation caused a sharp drop in their billings to which, currently, an increase in costs is added that in many cases threatens to destroy the narrow margins with which they subsist. The commerce and hospitality sectors also denounce that this rise occurs at a time when they have had to assume an extra investment in hygiene measures due to the pandemic, and invoicing in most cases less than half.

The kitchens of most restaurants and bars depend considerably on electricity, since appliances such as fryers, ovens, dishwashers or cold rooms are essential and their use is almost constant, in addition to other establishments, which even have cold rooms to preserve the merchandise. During the summer the air conditioners are also protagonists in the interior rooms. In bars, the rise on the initial bill is around 25%, says the owner of a hotel establishment located in the heart of Madrid.

Emilio Gallego, general secretary of the Hospitality Industry of Spain, warns that “energy represents between 8% and 10% of costs, so a rise of one third can cause an increase of between 2% and 3% % of fixed expenses in companies in the sector “.

The immediate consequence, according to comments, is that the hotel industry and the tourism sector “are losing competitiveness” compared to other countries. Given all this, the hoteliers demand that the Government sit down to negotiate and put on the table “a different pricing system”, also taking advantage of European Next Generation funds to increase energy efficiency and seek solutions to the cost of electricity.

Ballast for the self-employed
For his part, Lorenzo Amor, president of ATA (Association of Self-Employed), assures that “the price that electricity is reaching is a real scandal. It is a burden for many freelancers and for many small companies that are currently seeing a cost added in its production “.

He also comments that “on average, the self-employed paid 35% more in July for energy costs but, in August, with the heat wave and the rise in electricity, of course the bills “They are going to skyrocket. A self-employed person at the moment is paying on average between 200 or 300 euros more in energy costs than they did last year and this is an unaffordable cost for many of them.”

Amor also recalls that “in Spain the self-employed and companies pay the most expensive electricity in Europe, with which many companies are losing competitiveness with European neighbors. The Government has to put a stop to this now and not blame others. This it has the ability, and Europe has said so, to control electricity prices and therefore also has the ability to relieve the self-employed and companies of these costs that they are currently having. ”

Rosana Bermúdez, owner of a butcher shop in Córdoba for 13 years, assures that “I have never complained about paying for being self-employed, neither the quarterly nor the rent, but if I continue to pay 800 euros this month and next month, no I think I can keep my business open.

The price for renting the premises does not drop and I do not charge in conditions. We work to pay and we don’t even get to that well. “Stating that” at this rate, the neighborhood shops are going to disappear. “In his case, he cannot access the aid offered by the State since fortunately he did not have to close during the pandemic for having products of necessity.

“Short-term” measures
Faced with this situation, mainly motivated by the increases in emission rights and natural gas, and in order to curb the impact of the electricity pool as much as possible, the Government has lowered the VAT until the end of the year, which makes the electricity bill of 21 % to 10% and has suspended during the third quarter of this the tax on electricity generation, which represents 7%, and paid by producers, something that in any case does not compensate companies or consumers.

The Executive of Pedro Sánchez, in addition, remains willing to study all the proposals related to electricity, such as those presented by several ministers of its partners in the purple formation, knowing that “there is a long-term objective of reform of the system and a framework to combat climate change “.

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