Energy Minister Teresa Ribera told a press conference that the measure will continue until the end of March 2022, when natural gas prices are expected to stabilize after the drop in consumption from the usual winter highs.
At the same time, Spain will auction this year 900 million euros more in carbon dioxide emission permits, the proceeds of which will be used to reduce the bill.
Faced with voracious demand for natural gas, responsible for much of the recent rise in electricity prices in Europe, which has fueled inflation, Spain will limit regulated increases in fuel prices to 4.4% in the third quarter, versus forecasts for a 28% increase.
The left-wing coalition government has come under pressure from the opposition and civil society organizations to reduce the electricity bill.
President Sánchez announced on Monday that a special tax on electricity would drop to 0.5% from 5.1% until the end of the year, while a reduced VAT rate and the suspension of a tax on electricity generation from 7 % would run until January.