Average electricity price for regulated rate customers connected to the wholesale market is set to rise by 4.9 percent on Friday. Provisional data from the Iberian Energy Market Operator, OMIE, collected by Europa Press show the price reaching 219.21 euros per megawatt hour (MWh) compared with Thursday. [Source: OMIE data via Europa Press]
The increase comes from the combined sum of the wholesale market auction average and the compensation paid to combined cycle power plants as part of the Iberian exception aimed at limiting gas costs for electricity generation. [Source: OMIE data via Europa Press]
The wholesale market auction price, known as the pool, was 135.35 euros per MWh on Friday. The highest rate during the day is expected to reach 230.18 euros per MWh between 22:00 and 23:00, while the minimum for the day is projected to be 90 euros per MWh between 04:00 and 05:00. [Source: OMIE data via Europa Press]
To this pool price, a compensation of 83.86 euros per MWh is added, a payment that benefits consumers enrolled in the regulated tariff PVPC as well as those in gas supply plans that are indexed to the market. The aim is to shield consumers from the volatility of the free market while maintaining reliability of supply. [Source: OMIE data via Europa Press]
38% less
Without the Iberian mechanism to cap gas costs for power generation, the electricity price in Spain would average around 355.35 euros per MWh. That would be about 136.14 euros per MWh higher than the current regulated rate that includes the compensation paid to customers. On average, households experience a reduction of roughly 38.3 percent thanks to the mechanism. [Source: OMIE data via Europa Press]
The Iberian mechanism began operation on June 15 and sets gas costs for electricity generation at an average of 48.8 euros per MWh over a twelve month period. This framework is designed to help cover the winter period when energy prices typically rise. [Source: OMIE data via Europa Press]
Specifically, the Iberian exception charts a path for natural gas use in electricity production, with an initial increase of five euros per MWh in the first six months and adjustments continuing through the duration of the measure. [Source: OMIE data via Europa Press]
Teresa Ribera, the third vice-president of the government and minister for Ecological Transition and Demographic Challenge, estimated that the Iberian exemption will yield savings of 1,383 million euros for Spanish consumers over the two-month validity period. She noted that this figure corresponds to about 22 million euros saved daily for Spanish society since the mechanism came into effect. [Source: OMIE data via Europa Press]