On June 15th, the so-called “Iberian exception”, which the Spanish and Portuguese Governments received permission from the European Union, came into effect so that the high gas price does not spread to the prices in the wholesale market. This non-fossil fuel-generated electricity meant that the “pool” price in Spain diverged from the trend in European countries, which was clearly below what was in effect in other major economies in the region.
In the wholesale market, where the sales offers of generation companies are matched with the purchase offers of supply companies, the price of electricity in Spain was half (46.7% more than cheaper) in December compared to other major European countries. a study by the specialist consultancy Grupo Ase.
Average price in Spain was last month 135.29 Euros per megawatt/hourincluding compensation for combined cycles, the average price in Germany, France, Italy, the Netherlands and the United Kingdom was €272.67, which is 101.54 percent higher.
In 2022 as a whole, the average Spanish price (already added the adjustment for the petrol cap) totaled 209.69 euros, which is 18.93% lower than the average for the rest of the major nations (258.67 euros). France and Germany, along with the Scandinavian countries, have traditionally been the countries with the cheapest electricity prices. “but 2022 is a before and after”the report states. Last year the average price in Germany was €234.15 (11.66% more expensive than in Spain) and €275.08 in France (31.18% higher than in Iberia).
“For the first time, the Spanish price is below the German and French prices. The effect of the Iberian gas cap mechanism since June 15″, It maintains the ASE Group. In the special case of December, the high price cut in Spain was also influenced by the high renewable energy production in our country (the result of the country’s great commitment to green energy) and the temperate climate of the peninsula, but this last factor also comes into play. In other countries, he is faced with the fear of a winter as harsh as the previous one months ago.
Your monthly reports Association of Companies with Large Energy Consumption (AEGE) indicates the same direction. Second, data up to December reflect that the Spanish wholesale price remained below that of France and Germany in the accumulated period up to that time.
Fortia Energía (company owned by electro-intensive industries to buy energy in the market) on 28 November defended the “Iberian exception” that puts a cap on the price of natural gas (excluding combined cycles). Without the help of this hydrocarbon (nuclear, hydraulic and solar) electricity produced cannot continue to benefit from the high cost of natural gas, making all the electricity that passes through the wholesale market more expensive. CEO, John Temboury, He said this “adaptation mechanism” allows for a “much better outcome than the rest”.
Now only the compensation paid to combined-cycle power plants to cover the real price of the natural gas they consume to generate electricity (which critics are basing it on to question the model) should be paid in the same way. Iberian exception. What hinders this formula is, moreover, keep the hydraulics back as before, nuclear, solar and wind for the same price as combined cycles even though they don’t consume gas, which would have triggered the bill much more. This explains the drop in prices associated with countries that do not have this regulation in Spain. For this and other reasons, US credit rating agency Moody’s predicted on November 16 that electricity would be cheaper in Spain this winter than in Europe.
Inflation data from the European Statistical Office (Eurostat) confirm this: Spain has the lowest price level in the Eurozone (19 countries until December) and the EU (27 countries), which is very relevant for the following reasons: energy costs .
According to AEGE, the low price in Spain means that the Spanish electro-intensive industry (in the case of ArcelorMittal, Azsa and other companies) currently supports a lower cost than in Germany (219.38 euros compared to 222.64). From France (101.21) because in this country, with strong government intervention, there is a special rate and also the largest electricity company (EDF) is state-owned.
The adaptation mechanism has been the subject of much criticism in Spain. PP described it like this: “Iberian thymus”. But the liberal governments of Belgium and Austria, as well as the French executive branch, demanded measures similar to the Iberian exception from the EU. The EU has agreed to cap European gas with another mechanism that will co-exist with Iberian gas for three months from next February. The European solution was the result of long and tense negotiations between countries that demanded cheaper electricity and those that prioritized securing supply due to greater energy vulnerabilities. Spain proposed the Iberian exception and considered the cap on European gas a minor solution because its demand continues to end the marginal pricing system in place in the EU that guarantees all electricity (except when there is an exception, for example, Iberian one) from the most expensive source. to get paid.