The average price of electricity for regulated rate customers linked to the wholesale market will rise 1.53% on Tuesday compared to this Monday, up to 303.07 euros per megawatt hour (MWh), according to provisional data from the Operator of the Iberian Energy Market (OMIE) collected by Europa Press.
Brussels forces Spain to change the regulated electricity rate as a condition for approving the gas cap
The price of electricity for regulated rate customers linked to the wholesale market has not exceeded the level of 300 euros/MWh since March 10, the same week in which the record for the historical series was reached and which took place on March 8 with 544.98 euros/MWh, a record that occurred in the context of the upward spiral in the price of gas due to the Russian invasion of Ukraine at the end of February.
This price for PVPC customers is the result of adding the average price of the auction in the wholesale market to the compensation that the demand will pay to the combined cycle plants for the application of the ‘Iberian exception’ to cap the price of gas for electricity generation.
In the auction, the average price of electricity in the wholesale market – the so-called ‘pool’ – stands this Tuesday at 155.71 euros/MWh, which is around 2 euros less than the price for this Monday (157.54 euros/MWh).
The maximum electricity price for this July 12 will be registered between 9:00 p.m. and 10:00 p.m., with 201.6 euros/MWh, while the minimum for the day, of 123.55 euros/MWh, will be between 04:00 and 05.00 hours.
To this price of the ‘pool’ is added the compensation of 147.36 euros/MWh to the gas companies that has to be paid by the consumers who benefit from the measure, the consumers of the regulated rate (PVPC) or those who, despite being in the free market, they have an indexed rate.
12.65% less thanks to the cap
In the absence of the ‘Iberian exception’ mechanism to cap the price of gas for electricity generation, the price of electricity in Spain would have been an average of around 347 euros/MWh, which is around 44 euros/MWh more than with compensation for clients of the regulated rate, who will thus pay around 12.65% less on average.
In fact, in the absence of the Iberian mechanism, the electricity price for this Tuesday would be the tenth highest record in the historical series.
Compared to a year ago, the price of electricity for customers of the regulated rate for this Tuesday is 249.64% more compared to 86.68 euros/MWh on July 12, 2021.
The Iberian mechanism, which entered into force on June 15, limits the price of gas for electricity generation to an average of 48.8 euros per MWh over a period of twelve months, thus covering the coming winter, a period in which energy prices are more expensive.
Specifically, the ‘Iberian exception’ sets a path for natural gas for electricity generation at a price of 40 euros/MWh in the initial six months, and subsequently, a monthly increase of five euros/MWh until the end of the measure .