Loyalty comes at a price: why many Spaniards don’t change energy provider

Spain’s electricity market offers dozens of tariffs and companies, yet many households stick with the same supplier. This inertia has a cost: holding on to outdated tariffs prevents consumers from benefiting from lower prices and better terms. Here we summarise official data on switching, explain why so many people stay put, and show how much money is left on the table.

Little mobility despite liberalisation

According to the latest CNMC Household Panel, only 13.7 % of households changed electricity provider in 2024 and just 9.2 % switched gas contracts. For most of those who switched, the process was not difficult: only 7.7 % reported any problems. Yet the data reveal a sluggish market. More than half of consumers (around 55 %) have never switched supplier, and in 2015 the proportion was 70 %. A telling statistic is that one in five households doesn’t even know they can change their electricity or gas company.

This low mobility is largely due to lack of information and the belief that savings aren’t worth the effort. The Household Panel notes that many non-switchers assume they won’t save much by changing. The property-comparison site InmoClip warns that 67 % of Spaniards don’t understand their electricity bill and that most contract more power than they need, paying up to €210 extra per year. The same article cites CNMC data showing that more than half of households have never changed provider and that of those who have, 84.6 % did so to lower their bill. Lack of awareness and fear of a “complicated” process—especially among tenants who don’t realise they can choose their supplier—are frequent barriers.

The cost of loyalty

Staying put can mean paying a high premium. A study by the bill-analysis platform Zonox, reported in La Vanguardia, compared 18,600 electricity bills and found that the difference between the most expensive and the cheapest tariff for the same consumption can reach €468 per year. The article also notes that some free-market offers are up to 15 % cheaper than the regulated PVPC tariff. The company Hello Watt, cited by InmoClip, goes further: by adjusting contracted power and switching supplier, households could reduce bills by up to 50 %, equivalent to around €1,200 in annual savings.

Loyalty also exposes customers to unnoticed price hikes. In 2021 the CNMC found that several electricity suppliers took advantage of new network charges to raise energy prices by as much as 30 % and that most failed to inform customers transparently. Only a few companies sent a specific notice explaining the increase and offering the option to cancel without penalty. The Organisation of Consumers and Users (OCU) denounced these practices and demanded exemplary sanctions, pointing out that many companies do not adequately notify price increases and that such irregularities are “common”.

In addition, many suppliers use so-called “hook tariffs”: they offer very low prices to attract new customers, but after the first year they switch those who stay to higher rates. Analyst Manuel Palacín, co-founder of Zonox, explains that after the promotional period, companies “try to extract more value from the customer” and recommends reviewing the tariff annually to maintain new-customer prices. A passive customer base allows these increases to go largely unnoticed.

Why energy companies don’t alert customers

Current regulations do not oblige suppliers to propose the cheapest tariff to each customer. They must inform customers of contractual changes and price increases, but the CNMC has noted that in many cases this communication is not “transparent and understandable”. Moreover, most electricity contracts lack penalty clauses for early termination (only about 15 % did in 2015), so there is no risk of being charged for switching. Even so, companies keep customers on outdated tariffs because consumer inertia is profitable. The less people move, the less companies spend on acquisition offers.

How to break the inertia and save

Switching supplier is straightforward and doesn’t interrupt your supply: the distributor delivering electricity to your home remains the same. The CNMC reminds us that most households who changed provider didn’t encounter difficulties. To optimise your bill:

• Review your contracted power: adjusting it to your actual needs avoids overpaying. Tools like Selectra’s power calculator or the CNMC’s comparator can help.
• Compare tariffs every year: offers change frequently. Use official and independent comparators to find the cheapest free-market tariffs or check if switching to PVPC suits you.
• Check renewal conditions: many “welcome” tariffs have a limited duration. Read your supplier’s correspondence at the end of the first year and negotiate or switch if they propose a price rise.
• Demand transparency: suppliers must notify any contractual change and offer the option to terminate without penalty. If you receive an unjustified increase, file a complaint and compare other offers.

In a volatile price environment, misplaced loyalty is expensive. The market offers competitive options and legislation protects consumers’ rights to choose and switch supplier free of charge. Getting informed, comparing, and changing when necessary allows households to capture the savings that many Spanish families are currently missing.

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