The average electricity price for regulated-rate customers linked to the wholesale market rose 3.59% this Monday versus Sunday, reaching €271.06 per megawatt-hour (MWh). This provisional figure comes from data gathered by the Iberian Energy Market Operator (OMIE) and reported by Europa Press.
The move in price reflects the combination of the wholesale pool price and the compensation paid to gas-fired plants under the Iberian mechanism that caps gas costs for electricity generation. The calculation hinges on the auction price added to the required compensation under the policy.
The pool price in the wholesale market stood at €176.58/MWh for Monday. Intraday movements showed prices peaking between 21:00 and 22:00 at €250/MWh and dropping to a low of €125/MWh between 11:00 and 12:00. Such intraday fluctuations are common in wholesale electricity markets and mirror shifts in supply and demand across the grid.
The pool price is supplemented by a compensation to gas-fired generation under the Iberian mechanism, meaning that consumers benefiting from the policy bear this added cost. Specifically, the compensation amounts to €94.48 per MWh for gas companies, a cost borne by regulated-rate (PVPC) customers or by those on indexed rates, even if they operate in the free market. The structure aims to shield households from volatile gas prices while preserving system reliability.
34.5% reduction
Without the Iberian mechanism to limit gas costs for electricity generation, Spain’s electricity price would have averaged around €414.34/MWh. That represents an increase of roughly €143/MWh, highlighting the policy’s influence on consumer bills. In practice, regulated-rate customers are projected to experience an average cost reduction of about 34.5% across the policy period, compared with a scenario without intervention.
The Iberian mechanism, enacted into law on June 15, sets a cap on gas prices for electricity generation at an average of €48.8/MWh over a twelve-month horizon. This framework is designed to provide price stability as winter energy demand rises and market prices tend to climb, contributing to more predictable bills for households and small businesses alike.
Specifically, the policy outlines a path for natural gas pricing for electricity generation at €40/MWh during the first six months, followed by a monthly increase of €5/MWh for the remainder of the measure. This stepped approach seeks to balance immediate relief with gradual price normalization as market conditions evolve.
Teresa Ribera, the third Vice-President of the Government and Minister for Ecological Transition and Demographic Challenge, estimated this week that the Iberian exemption produced substantial savings for Spanish consumers over the two-month validity window. The figure cited was €1,383 million in savings across the eligible period. This assessment reflects the direct impact of the policy on household energy bills and, more broadly, on household purchasing power during a period when energy costs can be highly sensitive to market fluctuations.
Ribera noted that the headline savings comprise approximately €22 million in additional benefits reported for the Spanish community since the mechanism came into effect, highlighting the broader social and economic footprint of the measure beyond the headline totals. These figures illustrate how energy policy choices at a regional scale can translate into tangible financial relief for families and businesses while keeping system reliability and wholesale market integrity intact.