The Iberian plan to reduce the cost of electricity is already in the hands of Brussels, which will evaluate it urgently.

The European Commission (EC) confirmed Friday that it has received the proposal from Spain and Portugal to limit the impact of gas on the electricity market and lower the electricity bill and will study it "urgently" while "technical contacts" continue between Brussels, Madrid and Lisbon.

"The Commission has now received information from the Spanish and Portuguese authorities, which it will assess as soon as possible. On the basis of the information provided by Spain and Portugal, contacts will continue at a technical level," EU Competition spokeswoman Arianna Podesta told Efe.

The EU executive "remains committed to urgently assessing whether the temporary emergency measures in the electricity market proposed by Spain and Portugal are in line with both EU state aid rules and the internal energy market law, in the framework of the political agreement in principle reached in the past weeks," she added.

After months of pressure led by Spain to intervene in the electricity market and lower the electricity bill, the President of the Government, Pedro Sánchez, managed to get the EU-27 to approve an "Iberian exception" at the European Council on March 25. Madrid and Lisbon were left to work on the proposal at a technical level and send the details to the Commission, which had to validate the mechanism to limit the price at which gas is reflected in the peninsular electricity market.

The Spanish Vice-President Teresa Ribera and the Portuguese Minister for the Environment and Climate Action, José Duarte Cordeiro, met on April 26 in Brussels with the EU Vice-President for Competition, Margrethe Vestager, and at the end of the meeting announced that they had reached a "political agreement" to apply the Iberian derogation for at least one year.

The outlines of the agreement set a maximum gas price starting at 40 euros per megawatt hour (MWh) for the first few weeks, to rise progressively to an average of 50 euros MWh over the whole period, compared to the 80 euros at which it is currently calculated.

Combined cycle plants would be compensated for the difference, but given that the most expensive generation technology sets the price of the rest in the energy auction in the marginal system, the mechanism should allow to lower the megawatt hour of the electricity market around 130 euros compared to 200 at which it is currently paid, according to industry sources.

The aim was for the Commission to validate the system so that it could reach the May 3 Council of Ministers in Spain, for immediate implementation, but Spain and Portugal sent Brussels their final proposal later than planned and Ribera said Monday that she believed approval would be delayed "a week."

The First Vice-President of the Government and Minister of Economic Affairs and for Digital Transformation, Nadia Calviño said yesterday that the Government expects to be able to approve the cap at next Tuesday's Council of Ministers once all the details of the proposal with Portugal are finalized and the go-ahead is received from Brussels.