Electricity prices are set to rise this Friday, with increases exceeding 16 percent and peaking at 153 euros per megawatt hour MWh. The adjustment, which is a payment in the wholesale market that follows the gas cap, aims to compensate factories and is based on the outcomes of Thursday’s auction.
Friday should mark a reversal of the recent downward trend, though the price is expected to stay below the 200 euro per MWh threshold for a seventh straight day. In six of the last seven days, the price was lower than it was a year earlier.
According to the electricity market operator OMIE and the Iberian Gas Market Mibgas, the wholesale price of electricity will be around sixty euros lower for consumers under a regulated rate, compared with the amount that would have been paid at 214 MWh without the gas cap. This cap is designed to influence electricity generation costs.
As the month closes, the average price remains the lowest since the gas limit was introduced on 15 June, mirroring the trend seen in September, and still roughly 21 percent below the August peak, which remains the most expensive on record for that month.
Amid Europe’s ongoing energy crisis spurred by Russia’s invasion of Ukraine, Brussels is preparing new measures to curb high energy prices, with an extraordinary meeting of energy ministers scheduled for next Friday. The proposed steps include reducing energy consumption during peak hours, capping charges for renewable and nuclear energy, introducing a tax on windfall profits for energy companies, and pursuing market reforms to decouple generation from renewable capacity over the longer term.
In terms of Friday’s outlook among major European economies, Italy is projected to endure the highest price at 385 euro per MWh. In France, prices around 347 euro per MWh are expected, with Germany showing similar levels near 316 euro per MWh. The United Kingdom is anticipated to see about 190 pounds per MWh, equivalent to roughly 212 euros at current exchange rates. In Portugal, where the Iberian exception gas cap is also in play, the auction price is expected to align with Spain, reflecting their shared market dynamics.
Auction and setup
If the auction results are considered on their own, excluding the gas cap adjustment paid to factories, electricity would rise by more than 3 percent to around 118 euro per MWh. Looking at the daily timing, the highest price is projected to occur between 22:00 and 22:00, reaching about 218 euro per MWh, while the cheapest hour falls near 15:00 to 16:00 at around 80 euro.
These figures exclude the additional costs associated with adjusting gas powered plants, the amount of which depends on system demand and price. Those adjustments influence households and businesses alike, reflecting the broader cost of maintaining energy supply under the current framework.
For tomorrow, the provisional average adjustment for consumers is expected to be close to 35 euro per MWh, resulting in a final price near 153 euro per MWh, which is roughly 20 percent lower than the price a year ago.