On Sunday, regulated-rate electricity consumers who are linked to the wholesale market experienced a notable drop in the average price, sliding by about 42 percent from Saturday. The price briefly fell below the 100 euro per megawatt hour threshold for the first time since last April, signaling a shift in the regional energy dynamic. Analysts note that this move provides relief for households and small businesses relying on the wholesale-connected tariff, particularly as the market navigates seasonal price movements.
Specifically, the price is projected to settle around 90.34 euro per MWh the following day. This marks the third consecutive decline and represents the lowest level observed since the Iberian exemption began, according to provisional figures from the Iberian Energy Market Operator OMIE, as reported by Europa Press. The reading reflects the combined effect of the wholesale market auction average and the mandated compensation to combined cycle power plants under the Iberian exemption, which aims to cushion gas costs in electricity generation.
For regulated tariff customers connected to the wholesale market, the total cost arrives at 90.34 euros per MWh, the lowest reading since April 23. The market snapshot shows a pool price of 71.97 euro per MWh for Sunday, with volatility across the day. The system’s hourly dynamics indicate a daily maximum reached between 9:00 and 22:00 at 156.82 euro per MWh, while a notable dip is expected between 15:00 and 17:00 at around 1.29 euro per MWh. These intra-day variations illustrate how supply and demand balance interact with the pricing mechanism during a single day of operation.
To the pool price, an additional compensation of 18.37 euros per MWh is added, a fixed payment owed to gas companies regardless of whether consumers benefit from the Iberian exemption. This adjustment applies to both PVPC customers in the regulated tariff and those in the free market, with the latter experiencing price indexing in some cases. The combined effect shapes the final amount that households and small businesses pay under the wholesale-linked rate.
Almost 50% reduction versus the scenario without the measure
Removing the Iberian exemption would have left the electricity price averaging around 177.82 euro per MWh, which implies that the compensation component would have added roughly 87.48 euro per MWh to the adjusted rate paid by consumers. In effect, the exemption brings the overall cost down by approximately 49.2 percent on average, offering substantial relief to end users who participate in the wholesale market. This relief is particularly meaningful during periods of heightened energy demand and price volatility, helping to stabilize household budgets and business operating costs.
The Iberian mechanism entered into operation on June 15 and establishes a cap on gas-related costs in electricity generation. The framework is designed to average about 48.8 euro per MWh across a 12-month horizon, with the aim of smoothing price spikes and providing price visibility as the region approaches the winter period, historically a high-demand time for energy
The exemption outlines a staged approach to gas and natural gas consumption in electricity generation, starting with a price cap of 40 euro per MWh for the first six months. After that initial period, the price is set to rise by five euro per MWh each month until the measure concludes. This stepped progression is intended to balance the immediate need for price containment with the eventual normalization of gas costs as supply conditions evolve and regional energy markets adapt to evolving demand patterns.