Wednesday, January 19

The price of electricity breaks another historical record and soars in the wholesale market to 360 euros / MWh

The wholesale electricity market is going to pulverize a new historical maximum this Wednesday, standing at 360.02 euros per megawatt hour (MWh), dragged down by the stratospheric rise in natural gas, in a context of growing concern about the supplies of this raw material from Russia to the EU.

The lack of electrical control worsens: the markets are betting that the prices of 2022 double those of 2021

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It is the first time that the so-called pool has exceeded the barrier of 360 euros / MWh and it has already been seven consecutive days above the level of 300 euros, which the so-called pool exceeded for the first time last Thursday. However, the prices that the Spanish market has been registering for days are lower than those of other large European markets: this Wednesday, in France it stands at almost 453 euros and in Germany, at 416 euros.

This Wednesday, the most expensive hours will be 7:00 p.m. and 8:00 p.m., with a new historical hourly maximum of 380 euros / MWh, and the cheapest, 24 hours, with 331.4 euros / MWh.

The ‘pool’ prices have a direct impact on the regulated tariff (the so-called PVPC), which is served by almost 11 million consumers in the country, and serves as a reference for the other 17 million who have contracted their supply in the free market .

With gas warehouses in Europe already below 60% (in Spain they are at 68%), the European energy crisis worsens, in a context of growing tension between Russia and the West. Already into winter, falling gas shipments from Russia, the EU’s main supplier, low temperatures on the continent, problems detected last week in several nuclear reactors in France and low levels of inventories have led to On the morning of this Tuesday, the price of this raw material shot up again by more than 10%.

Following statements by Russian President Vladimir Putin, threatening to respond to the West with “adequate technical-military measures” if there are “hostile” measures in the face of the deployment of tens of thousands of Russian soldiers on the border with Ukraine, they have made the reference European TTF skyrockets more than 15% and is already above 174 euros / MWh, an unprecedented figure that contrasts with the 17 euros a year ago and 65 euros at the beginning of November.

The gas market situation and the spectacular escalation of this raw material have run in parallel as the tension between Russia and Ukraine increased, after the suspension of the start-up of the Russian Nord Stream 2 gas pipeline by Germany. And to this is added the rise in CO2 emission rights. These also affect the cost of producing with gas and are close to 80 euros per ton.

The new escalation that began last week led the Government to confirm the extension of the tax reductions of the invoice that were due at the end of the month and will be extended until April. The Executive maintains that the word that the household bill ends in 2021 at levels similar to those of 2018 will be fulfilled, discounting inflation. However, the Government admits that it is an “average” and there will be households that will pay more: those benefiting from the PVPC, which has traditionally been the most competitive.