15% less
A recent trend shows the average price for electricity charged to regulated rate customers linked to the wholesale market dipping. For the cycle from Thursday through the following Wednesday, the price is projected to be €186.08 per megawatt-hour (MWh). This figure comes from provisional data gathered by the Iberian Energy Market Operator, OMIE, and reported by the European press agency EP.
The drop reflects a balance between wholesale market performance and the compensation added to cover the demand for gas usage by combined cycle plants under the Iberian exemption. This exemption is designed to cap the gas price used in electricity generation, helping to stabilize consumer costs in a volatile energy market.
During the auction, the average price of electricity in the wholesale market, often called the pool, was €113.11 per MWh on Thursday. The market also shows intraday volatility, with the maximum price recorded around €220 per MWh between 22:00 and 23:00, while the daily minimum hovered near €75 per MWh between 05:00 and 06:00.
To the pool price, a compensation of €72.91 per MWh is added. This amount is payable to gas companies, regardless of whether a consumer benefits from the Iberian exemption or is paying the regulated rate (PVPC) or a market index. In the free market, customers experience an indexed rate that can fluctuate with market conditions.
15% less
Without the Iberian exemption, the electricity price in Spain would average around €219.31 per MWh. That would be roughly €33 per MWh higher than the compensation framework provides to regulated-rate customers, resulting in about 15% higher costs for those paying PVPC on average.
The Iberian mechanism, which began on 15 June, sets a cap on natural gas prices used for electricity generation at an average of €48.8 per MWh over a 12-month period. This approach is designed to provide price relief during the winter months when energy costs tend to rise. The policy outlines an initial period in which gas prices for generation could rise by €40 per MWh in the first six months, followed by smaller increments of €5 per MWh each month thereafter until the measure ends.
Overall, the policy aims to shield consumers from sharp gas-driven price spikes while maintaining stability in the electricity market. Analysts note the interplay between wholesale prices, regulatory interventions, and compensation mechanisms that influence what end users pay for electricity across different market segments.
In Canada and the United States, similar discussions about wholesale price transparency, regulatory protections, and market-based pricing continue to surface. Stakeholders emphasize the importance of clear data, predictable policy, and effective risk management for households and businesses navigating energy costs in North American markets. The Iberian experience provides a case study in how coordinated market design and targeted exemptions can affect daily pricing and monthly bills, even as global energy markets remain sensitive to supply, demand, and geopolitical factors. Citation: OMIE data; European energy press reports.