electricity prices Now they are going under and breaking records for declines. Wholesale electricity market – electricity and traders they buy and sell energy to be consumed the next day – setting very low prices for the whole week and increasing the number of hours for which they set a zero euro price.
The average daily price of electricity did not change in the market, which serves as a reference for more than 8 million households with electricity tariffs. 5.03 euros per megawatt hour (MWh) this Sunday, According to provisional data from the Iberian Electricity Market Operator (OMIE), it is in line with the levels recorded during the week and above the 1.51 euros per MWh set for this Saturday (the lowest level in almost three years).
But the most remarkable thing is that they will accumulate on Sunday 16 hours straight electric zero euro (between 01:00 – 18:00)the highest number of hours to zero in almost a decade. And as highlighted, this many watches have not been recorded at zero price since February 8, 2014, when a total of 17 watches were collected. Francisco ValverdeExpert consultant on energy.
There is just Two days in the history of Spain electricity market marked at zero price throughout the day respectively, 29 March and 1 April 2013in the middle of Holy Week that year. However, at that time, the development of the wholesale market did not have a direct impact on consumers’ bills, given that the electricity price of the regulated electricity tariff was determined through special auctions that were held every three months and determined the price. entire quarter.
More renewable, cheaper
Also known as the electricity market swimming pool, sets prices through a marginal system that sets the price of others for the latest, most expensive technology needed to meet demand at all hours of the day. Some so-called marginal production technologies ( renewablenuclear and hydroelectric) enters the market at a zero price, so when the production of these energies is sufficient to cover the entire planned consumption, the price remains at zero euros.
That’s what he’s spent several hours almost every day this week. So far this year, Zero euro in 85 hours in the electricity market and there are hundreds of watches where prices below one euro have been recorded. The combination of moments of reduced demand and the increasing weight of renewable energies in the electricity generation mix in Spain is causing these events to reoccur more frequently. Zero price hours are concentrated on weekends and holidays due to low electricity consumption.
During this week, renewable energies at times concentrated more than 70% of all electricity generation, coinciding with the closure of many nuclear power plants. HE swimming pool Thank you for pointing out the lowest prices in history all week long. Wind energy production record due to the storm Ciarán and now Domingos, which hit a large part of the country, and also due to the strong contribution of photovoltaic and hydraulic energy.
Zero euro is not free electricity
The fact that the electricity market has fallen to zero euros does not mean that electricity is free on consumers’ bills. On the one hand, the development of the wholesale electricity market has only a direct impact on the bills of more than 8 million customers who contract with the regulated tariff, the so-called voluntary price for small consumers (PVPC). On the other hand, since the energy price is only one of the components that make up the bill of all customers, both those who have a regulated tariff and the majority who prefer the free market tariff (the price of which is freely determined by the government electricity companies).
In addition to the energy component, the bill also includes certain taxes (now reduced or temporarily suspended by the Government as part of the anti-crisis social shield); Regulated fees set by the government and serving to pay the fees for renewable energy sources, extra costs of off-peninsular regions or electricity system debts; and access fees established by the National Markets and Competition Commission (CNMC) and used to finance the costs of transportation and distribution networks. The energy portion of the price may be zero, but customers must continue to pay for the remaining components.
8 million households were given time
The development of the price of the wholesale electricity market directly conditions the bill of the 8.5 million households that have signed a regulated electricity tariff contract, the so-called voluntary price for small consumers (PVPC). The cap for the Iberian exemption requires that the compensation paid to power companies with gas plants be added to the electricity market price, but since the mechanism has been inactive since last February (the gas price is below the fixed cap) the cost of this adjustment is now zero.
The government has approved a reform of the regulated tariff with the aim of reducing its volatility by linking the formation of its price not only to the daily electricity market, but also to other relatively more stable long-term electricity markets. A reform that will come into force in January 2024 and will increase the weight of the long-term development of the markets on the final price every year.
Last year, the electricity market set record prices amid the energy crisis and was subject to extreme fluctuations, worsened by the economic impact of Russia’s military invasion of Ukraine. There were exorbitant increases and historically high prices for months; until then, the daily market had seen unimaginable prices exceeding 500 Euros per MWh and hourly records of up to 700 Euros per MWh.