Electricity price
The electricity bill is one of the expenses that most impacts family and business budgets, especially in a period in which the cost of electricity continues to fluctuate. This is why one of the priorities is to know the price of electricity and how much 1 kWh really costs today.
Let’s analyze together the price of electricity in Italy, the trend of the PUN and how to correctly calculate the actual cost of your consumption.
The following information is expressed in a simplified form for information purposes only. For accurate consultation, please refer to the information provided by the competent authorities.
What is kWh and how is the cost of electricity calculated
To understand how the price of electricity is formed, we must start from the basic concept of kWh, or kilowatt hour. A kWh represents the energy consumed by a 1.000-watt device in operation for an hour. If, for example, you leave a 2.000-watt oven on for half an hour, you have consumed exactly 1 kWh. When you look at the bill, however, the average kWh cost all-inclusive does not only refer to the price of pure energy. This also includes:
- Energy price;
- Network costs (transmission, distribution);
- General system charges (renewable energy support, social bonuses);
- VAT and excise duties.
To correctly calculate the cost of electricity kWh, you must therefore add all these elements. This is also why the kWh price today that you read in newspapers or on official websites may seem much lower than the final one on the bill.
What is the difference between kW and kWh?
When talking about electricity bills, you’ve probably noticed the acronyms kW and kWh. Although they may seem similar, they refer to two very different concepts, which are fundamental to understanding how electricity consumption works.
- The kW (kilowatt) is a unit of measurement for electrical power. It indicates how much energy an appliance can absorb or deliver at a given time. For example, a washing machine might have a power of 2 kW. In bills, the kW is linked to the contracted power, or the amount of energy you can use at the same time without tripping the meter. In a standard home, a contracted power of 3 kW is usually the starting point, but those with many appliances, swimming pools or heat pumps may need to increase this to 4.5 kW, 6 kW or more;
- The kWh (kilowatt hour), on the other hand, measures energy consumption over time. If you keep a 1 kW stove on for an hour, you have consumed 1 kWh. And it is precisely on these consumed kWh that the costs in the bill are calculated.
PUN Index GME: what is it?
Until 2024, the Prezzo Unico Nazionale/National Single Price (PUN) represented the reference value of electricity purchased wholesale on the Italian Electricity Exchange. Starting from January 2025, however, the mechanism evolves: the GME PUN Index is born, introduced by the Gestore dei Mercati Energetici/Energy Markets Manager (GME).
The new index no longer indicates a single national price, but a weighted average of hourly zonal prices, calculated based on the quantity of energy sold and the specific time slots. With the arrival of the PUN Index GME, the price of electricity depends on the geographical area in which consumption occurs. Italy is divided into market areas (North, Center-North, Center-South, South, Sicily, Sardinia, Calabria) and each area will have slightly different values depending on the availability and demand for energy.
In this transition phase, thanks to an equalization mechanism provided by ARERA, the transition to the new index should not lead to significant changes in the electricity bill of end consumers. As regards the data for the current month, day and year, all the data can be accessed on the GME website.
How much does 1 kWh cost today?
When talking about kWh price today, it is necessary to consider that the cost of electricity varies based on different factors: the type of contract (free or protected market), the trend of the Prezzo Unico Nazionale/Single National Price (PUN Index GME), the geographical area and the type of offer chosen (fixed or variable).
In general, the price of electricity varies every 3 months and is attributed to electricity supplies in the protected market regime through the National Electricity Service. For the free market, responsibility falls on individual suppliers. Furthermore, the situation of the protected market in Italy for electricity is an important and evolving issue. For non-vulnerable customers, the protected market for electricity ended on 30 June 2024. Starting from July 2024, these customers were automatically transferred to the Gradual Protection Service (STG – transitional regime lasting a maximum of three years, therefore until June 2027). Vulnerable customers, however, continue to have the right to remain in the Greater Protection Service, with contractual and economic conditions defined and updated by ARERA.
For this reason too, it is useful to compare the price of electricity on the “free market” (mercato libero) among the various proposals available to identify the solution best suited to your consumption. Here the price of kWh varies enormously based on the supplier, the type of offer (fixed or variable), the reference index (usually the PUN Index GME for variable offers) and any discounts or promotions. Therefore, there is no single price for 1 kWh, but it is possible to define some orders of magnitude today:
- Estimates offered at variable price (May 2025): The cost of kWh is linked to the trend of the PUN Index GME, which stands at around €0,100/kWh (this is the wholesale price, to which the supplier adds its own margin and other costs).
- Fixed price offer estimates (May 2025): The price per kWh remains fixed for the duration of the contract and can vary significantly between the different offers available. Today you can find offers with prices ranging from approximately €0,12/kWh to €0,18/kWh (or even more, excluding VAT and taxes).
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FAQ Electricity price
What is the price of electricity in 2025?
The price of electricity in 2025 is a complex topic influenced by multiple factors. There is no single price valid for the whole year and for all consumers. At the moment (May 2025), the wholesale price of electricity (PUN Index GME) has shown some variability with a downward trend in recent months. For vulnerable customers in the protected market, there was an increase in the first quarter and a decrease in the second.
What is PUN and why does it affect the bill?
The PUN is the average price of wholesale electricity on the Italian market, calculated every day. It represents the starting point for calculating the cost of energy in variable price contracts. When the PUN rises, the costs on the bill increase; when it falls, it is possible to save.
How is the cost per kWh calculated on the bill?
The cost per kWh includes:
- The price of pure energy (often based on PUN).
- Transport and meter management costs.
- System charges and taxes.
The final rate is therefore a sum of items, some fixed and others linked to consumption. It is important to read the bill carefully to understand the cost details.
Is it better to choose a fixed price or one indexed to PUN?
It depends on the consumption profile and risk appetite:
- The fixed price guarantees stability and protection from price increases.
- The price indexed to the PUN can bring savings if prices fall, but is more exposed to market volatility.
In 2025, with the uncertainty of energy costs, many consumers choose mixed tariffs or offers with protection thresholds.
Where can I check the updated PUN price?
The PUN is updated daily and published on the official GME website (www.mercatoelettrico.org). Alternatively, some tariff comparison portals and apps for home energy management show the data in real time, making it easier to plan consumption during the most convenient hours.