Much of the Brussels electricity reform is in effect in Spain without avoiding the price crisis.

HE main axis is to encourage bilateral contracts between producer and consumer (the so-called PPA, the English abbreviation for Power Purchase Agreement) some deletion obstacles. Which of these contracts Spain European leaderAccording to sources from European Commissionbut with a very low level of production compared to the total – in between flaws HE buyer’s risk to make sure you will need determined amount of energy a long time (for example, 20 years). Brussels proposes that the State undertakes this risk. public guarantees.

Spain created the FERGEI fund in 2020 within the framework of its Electro-intensive Industry Regulation. 200 million euros per year much up to 600 million eurosfor supporting large energy consumers. But as confirmed by sources Ministry of Industry, Trade and TourismStill no warranty has been formalized. “HE volatility context Energy prices since the start of Russia’s war against Ukraine prevented it from fixing prices in the long run For the signing of the PPA”, they add, from the ministry still led by the Madrid mayoral candidate, Reyes Maroto. Negotiations have started to take advantage of the fund, such as the Large Energy Consumption Companies Association (AEGE), which has been planning a large renewable energy tender with these guarantees for months.

Another key piece is auction promotion (calls contracts for difference In energy jargon, which includes setting a regulated price for a certain amount of energy, and if the energy in the market exceeds this price, the difference remains with the State, if it is lower the State has to compensate the promoter) —. Spain is one of them. nine European countries With this system, there is even a bidding calendar until 2025. price crisis because companies with such high prices in the daily market (‘pool’) accepting low prices does not pay them prefers to wait for the next 12 years.

without touching the market

“One very shy answer and lags far behind Separating the electricity market from gasIn his speech at the Spain-Portugal summit, the Portuguese Prime Minister said that the rule of fixing the price of electricity with the most expensive generation source and establishing it according to the average price should be ended. Antonio Costa. Following this proposition, Spain, reduced the volume of the daily market as much as possible by further promoting renewable tenders and imposing them for nuclear and hydraulic Older, But The European Commission rejected this, thinking it would frighten new investments.

“How is it possible for factories that were satisfied with an income of 50 euros per megawatt hour (average wholesale market prices in recent years) to now generate an income of 100 euros, it adds nothing,” the economics professor agrees. Pompeu Fabra University, Albert Banal-Estanol. But Banal-Estanol believes there are “some things” that are positive, such as “resilience, responsiveness, and storage” that will be “crucial issues for getting off gas.” large inputs of renewable energy.

it corresponds store AFRY senior advisor, Javier Revueta. The only tool ever to be developed capacity payments (so that power can be used when needed) is to show that something exists. market failure And now Brussels opens the door for the Government to design mechanisms to attract storage If you think that the capacity tools are not enough Integrate all renewable sources in line with Spain’s wishes simplify processes to avoid having to go through procedures involving government assistance.

Details

Editing director of Fenie Energía, Javier BescosIt confirms that the European Commission has handed over the price issue. marginal futures market (taking the daily market as the main reference) and adds that the quote creates even one. additional conflict By forcing marketers with “200,000+ customers” to protect themselves and bid fixed price contracts at least 12 months because “if the generator offers 300 Euros, you have to buy it and it may not be a good price, just like in the daily market, we lose a little. flexibility negotiation we have”. On the possibility of having government guarantees –industry– acknowledges that “the European offer is very general and is the same as a 10% guarantee, you need to see the details and the risk to be passed on to the State”.

From the big sector, AEGE General Manager, Pedro Gonzalezbelieves that among the measures that most benefit them is the possibility of having multiple energy suppliers –“I wouldn’t have signed a PPA with Endesa if I had ever contracted with Iberdrola”, he says– e “interpret” one of the priority given to PPAs at auctions preferential access to the grid for renewable energy sources who has entered into a long-term contract with a consumer. “To be draft regulationthe content is uncertain, it all depends on how it goes and the will of the States,” explains the energy director of auditing and consulting firm Mazars, Luis Deza.

discussion

Spain, which was extremely restrained in its response despite Brussels’ withdrawal of its proposal, as its Minister of State for Energy admitted on Friday, set its sights on the fact that there is still “months of work” in the negotiations. Sarah Agesen. The previous day, at a forum organized by El Economista, he urged different agencies in the industry to send anything to the Manager. development to reveal them in the next step 28 March Energy Council. The intention of Spain and Brussels, reform approved in the second half of 2023before the European elections in mid-2024; This a priori limits the possibility radical changes this (again) opens up great debate.