Domestic natural gas demand falls 21% over the last five years

Spain has reduced its demand for natural gas by 21% since last August, without considering exports, which increases to 23% when the import balance of the previous five years is taken into account. Electricity demand, on the other hand, has fallen by 7.5%. These are some of the most significant data of the balance of the third month of the Plan +SE presented on Monday by the Ministry of Ecological Transition and Demographic Challenge (Miteco). These decreases are largely due to the More Energy Security Plan (Plan +SE): of the 73 measures it contains, a total of 44 have already been implemented or will be implemented soon, and several more, medium and long term, have already begun their development, as indicated from the Miteco in a statement.

From Europe, the latest extraordinary measures to reduce the consumption of gas and electricity of the states during this winter and to increase the security of supply of the community block were approved in the European Council of December 19. The first accelerates the processing of renewable energy projects; the second develops new solidarity mechanisms, including joint gas purchases to fill subway storage facilities; and the third establishes a dynamic cap on the price of natural gas when it exceeds 180 E/MWh to prevent price peaks and excessive volatility in the energy derivatives markets, with special attention to the Dutch TTF.

Along these lines, and in order to comply with its European commitments, since the beginning of August the Government has been adopting measures such as those adopted last October 11 when the Council of Ministers approved the +SE Plan, with three main objectives: to increase consumer protection, reduce energy consumption and reinforce solidarity with the rest of the EU, increasing gas exports. Consumer protection has achieved that all households with gas heating have reduced regulated tariffs -the TUR-, including neighboring communities, or that vulnerable households pay up to an electricity bill up to 28% less last 2022 than in 2021, thanks to the reinforcement of the bono social.

For its part, the recent Royal Decree-Law 20/2022 includes the last three measures of the +SE Plan: the modernization of the electricity transmission grid Planning framework; the Perte decarbonization of industry, endowed with 3,100 million euros; and new support for industry, with 950 million to offset energy costs to gas-intensive companies and loans from the ICO-Ukraine line. This RDL also extended numerous support measures to 2023, such as the 80% reduction in electricity taxation or the limitation of the price of the butane cylinder.

Solidarity with the EU

Spain is acting in solidarity with the rest of the EU, making it easier to cover the energy demand of France and Portugal, mainly. Since August 1, electricity exports to France, which has a very significant part of its nuclear fleet inoperative, total 6.7 TWh, compared to average imports of 2.1 TWh in the same period of the last five years; in the case of Portugal, whose hydroelectric generation is greatly reduced by the drought, exports have increased sixfold, reaching 2.5 TWh.

On the other hand, on January 10, Spain submitted to the European Commission its proposal for reform of the EU electricity market. Based on long-term contracts for differences in energy and incentives for capacity and flexibility, its application will allow lower prices and reduce volatility, while advancing in the decarbonization process, guaranteeing security of supply at all times and distributing costs more fairly between producers and consumers.