65% less
The typical price of electricity for users under regulated tariffs connected to wholesale-market pricing is set to rise this Saturday. The wholesale rate stands at 34.36 euros per megawatt hour (MWh), marking a substantial 62.7% jump from Friday, which logged 21.12 euros per MWh. This shift comes after six days of price stability, during which the market recorded the month’s second-lowest level following a daily low on Friday.
Looking back a year, the average electricity price on 24 December 2021 reached 311.02 euros per MWh, underscoring how the current change fits into a longer trend of volatility within wholesale electricity markets.
In the auction, the standard price for light in the wholesale market, known colloquially as the swimming pool, is projected at 36.41 euros per MWh for Saturday. Under the temporary arrangement, the top price is capped at 106.48 euros per MWh between 18:00 and 19:00, while the bottom price is 20.10 euros per MWh from 23:00 to 12:00. These figures come from the Iberian Energy Market Operator (OMIE) and have been reported by Europa Press.
On top of this pool price, there is an additional charge: a compensation payable to gas suppliers. Those benefiting from the measure bear a negative adjustment for Saturday, at -2.05 euros per MWh, which is charged to regulated tariff (PVPC) customers or those with indexed rates, even if they operate within a free-market framework.
The trend is described as 65% lower for certain customer groups when compared to earlier benchmarks, reflecting a combination of market dynamics and policy interventions. In the absence of an Iberian exception mechanism to cap gas prices for electricity generation, Spain’s average electricity price sits near 98.94 euros per MWh. This means an approximate 64.58 euros per MWh premium above the compensation available to regulated tariff customers, who on average pay about 65.27% less.
The Iberian mechanism, introduced to smooth price fluctuations, creates a shield for electricity generation costs by setting a gas-price ceiling. The policy aims to provide more predictable bills during the winter months, a period traditionally marked by higher energy costs. As described, the mechanism began on 15 June and targets a stable average price that can endure the tougher months ahead.
Specifically, the mechanism outlines a path for natural gas to generate electricity at approximately 40 euros per MWh, with an initial increment of around five euros per MWh per month during the first half of the measure, followed by a more gradual adjustment through the end of the policy window. This framework attempts to balance market pressures with consumer protections, ensuring that electricity remains affordable as seasonal demand climbs.