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Utility costs

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Topic starter
(@thnker10)
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Joined: 1 year ago

Called into the utility show yesterday and was surprised to see how expensive they are in Portugal. Of course coming from America where utilities are under priced (a discussion for another time) I'm sure I would be surprised to see the true cost of utilities all over the world. Are they generally more or less expensive in the bigger cities in Portugal?

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(@jeanne)
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Joined: 2 years ago

A good portion of the price is likely taxes, which vary greatly. In the US, just think of how much of a gallon of gas goes to tax, or the multiple taxes and fees added to a phone bill.  I read recently that the big difference in the price of bottled gas between Portugal and Spain is almost entirely due to their different tax rates. 

And yes, Americans are spoiled with low energy rates, which is one of the reasons we consume so much of it. 

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Posts: 357
Premium Member
(@jeanne)
Member
Joined: 2 years ago

A good portion of the price is likely taxes, which vary greatly. In the US, just think of how much of a gallon of gas goes to tax, or the multiple taxes and fees added to a phone bill.  I read recently that the big difference in the price of bottled gas between Portugal and Spain is almost entirely due to their different tax rates. 

And yes, Americans are spoiled with low energy rates, which is one of the reasons we consume so much of it. 

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Ask our Expat Consultant
(@thomasribatejo)
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Joined: 5 years ago

The geographical location makes limited difference beyond the way you need to respond to the local climate.

Water is specifically linked to local companies (the municipality, or a company they've set up).  This can vary - a recent survey showed the most expensive municipality was 25% more expensive than the cheapest.  (Remember, water bills include supply, waste water and solid waste, unlike some countries where waste is charged in connection with property taxes.  Waste charges are charged proportionately to your water consumption, as a rule).  You cannot choose supplier.

Mains gas may vary a bit, as suppliers are somewhat localised (as there is not a national mains gas network, and coverage is much more limited than in some European countries).  You cannot choose supplier.

Electricity varies primarily by supplier, and you can switch easily, but actually the differences are relatively small, outside of possible campaigns to attract people to switch.  Your location is largely irrelevant here.

Bottled gas similarly has pretty standard pricing nationally and across suppliers.

What does make a huge difference is type of property, and lifestyle, of course.  A well-insulated apartment versus an uninsulated detached house could make a difference of 100s per year.  Having exterior watering to do will make a big difference to your water bill.  Lifestyle features (aircon, pool, habits relating to lighting) will all make a difference, naturally.

So, to control costs, think about what you'll be needing/using, and check the property you're buying for efficiency in those regards.

Another factor we didn't get into in the webinar (though Pamela touched on in passing) was that higher levels of usage are more costly.  A higher electricity rating (kW) supply costs more in standing charges and per kW than a lower one; a certain level of water is charged at a lower unit cost, above which it's bumped up.  This is based on two logics:

1 - "social" - in other words, ensuring basic needs can be met more affordably, aimed to support people with more limited means without a laborious means-testing process;

2 - environmental - disincentivising larger consumption than is considered essential.

 

Thomas

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Posts: 458
Community Member
(@aspidistra)
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Joined: 1 year ago

Just wanted to say how incredibly useful the zoom thing on utilities was, by the way, it cleared up several things for me. Thanks all 😀

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