The Council of Ministers approved the new Bill Decree on 9 November. At the center is a cap of 58.9 euros per megawatt hour on gas burned by power plants, valid from January for a maximum of 18 months. According to the calculations, the savings should be from 15 to 40 euros per year.
Green light from the Council of Ministers to the new law decree on “Urgent provisions for reducing the cost of electricity and gas“. The measure, arrived after a long discussion with the European Commission and developed with the contribution of Arera and Gme, aims to lighten, for a limited period, the burden of bills on families and businesses. The heart of the intervention is a reimbursement that covers part of the expenditure incurred for the gas used to produce electricity, a price cap which from January 2027 should reduce costs. For families, according to initial calculations, the savings range from 15 to 40 euros per year.
The logic is to act upstream since the price of gas is reflected in that of electricity, therefore mitigating its impact means slowing down the final cost of electricity. The expected effect is quantified by the Minister of the Environment and Energy Security, Gilberto Pichetto Fratin, according to whom from January all the measures should translate into an average cut of around 15 euros per megawatt hour.
According to the Government, the savings on the bill could be “around 280 euros for a typical small artisan business, with consumption of 40 megawatt hours per year, of around 210,000 euros for a large company in the food sector, with consumption of 30,000 megawatt hours per year, of around 520,000 euros for an energy-intensive company with a significant share of self-production and consumption of 40,000 megawatt hours per year”.
The Price cap mechanism which will reduce costs from 2027
Prime Minister Giorgia Meloni explained that the decree intervenes with three choices. The first is precisely the roof: when gas exceeds 58.9 euros per megawatt hour (today it costs 82.2), the mechanism is triggered that prevents the price increase from being fully transferred to the price of electricity. The other two, in the Prime Minister’s words, are to ensure that the benefits of energy produced at lower costs reach the bills and to protect the savings intended for consumers. Added to this is a cut of over 850 million euros in the system charges that weigh on the gas bill.
The price cap will start on January 1, 2027will remain in force for a maximum of eighteen months and will close with a gradual exit, so as to avoid repercussions upon expiry. However, the cap does not erase the real cost of gas. The producer will continue to purchase it at the market price and the difference compared to the threshold will have to be covered. The producers themselves will be partly responsible for this and partly the customers with a variable price contract, through an additional charge on the bill.
The decline has cascading repercussions on the Pun, the wholesale price of electricity, which in Italy closely follows the trend of gas. Today it travels at 313 euros per megawatt hour, compared to 107 a year ago. And if the PUN drops, the rate that businesses and families find on their bills will also lighten. The Minister of the Environment and Energy Security, Gilberto Pichetto Fratin, quantified the effect of the Bill bis Decree on Radio anch’io, on Rai Radio 1: “A 4-5% reduction in the final price of energy. Whoever has 1000 euros gets 950, whoever has 10,000 euros gets 9,500“.
How much you will really save: estimates for families and businesses
The question that most interests consumers remains open: how much they will really save. According to the think tank Eccoand based on the information currently available, “the impact of the roof would be minimal: the family would save less than €1.4 per month, the company 1.9% compared to the homeless case. The estimate is based on declarations relating to the level of the ceiling (approximately €59/MWh) and duration of the mechanism (12-18 months), and is calculated according to the scheme proposed by the ARERA Consultation Document in June”.
“A cap of €59/MWh, with gas around €100/MWh, does not, however, mean a discount of €40/MWh. The constraint on flows with foreign countries envisaged by the DCO, in fact, limits the reduction in the price of gas delivered to production plants to around €10/MWh on an annual average, which translates into just €13/MWh less on the wholesale price of electricity. subtracting the reimbursement due to producers, with methods still to be clarified, an already modest benefit, diluted in a bill in which the fiscal and parafiscal components weigh heavily. This translates into approximately €17 per year for an average family. A cup of coffee a month”.
The reading from Confcommercio is more optimistic, according to which “the introduction of a ceiling on the price of gas is positive, temporarily intervening on the mechanism for forming the price of electricity. However, according to the Confederation, “it is important to ensure that the financing methods of the measure do not lead to further burdens on bills and that the benefits of the intervention are effectively transferred to end customerstranslating into a concrete reduction in energy spending for families and businesses. At the same time, it is essential to continue working on the structural reforms necessary to contain energy prices in the long term, intervening both on the weight of general system costs and on the mechanism for forming the wholesale price of electricity, to reduce dependence on gas”.
