Electricity rises 20% this Monday and returns to 200 euros per megawatt-hour

Madrid 12 JUN 2022 - 16:53CEST

The average price of electricity in the wholesale market will return this Monday to the E200/MWh

barrier, according to data published by the Iberian Energy Market Operator (OMIE).

Specifically, the average price of electricity this Monday will be 200.62 euros/MWh, which is 20%

more than the price this Sunday (167.06 euros/MWh), while compared to last week's Monday it will rise by 5 euros/MWh.

The maximum price of electricity on June 13 will be recorded between 21.00 and 22.00 hours, with 238.40 euros/MWh, while the minimum for the day, of 160.5 euros/MWh,

will be between 03.00 and 04.00 hours.

Compared to a year ago, the average electricity price for this Monday will be 153.31% more expensive

than the 79.20 euros/MWh of June 13, 2021.

Pool prices have a direct impact on the regulated tariff -the so-called PVPC-, to which almost 11 million households in the country are covered, and serve as a reference for the other 17 million that have contracted their supply in the free market.

In fact, the National Commission for Markets and Competition (CNMC) has found that in 2021, as part of the upward spiral of energy, around 1.25 million people

switched from the PVPC to a fixed-price free market tariff.

In mid-May, the Official State Gazette (BOE) published the Royal Decree-Law establishing the mechanism to limit the price of gas for electricity generation to an average of 48.8 euros per megawatt-hour (MWh)

for a period of twelve months, thus covering the coming winter, a period when energy prices are more expensive.

Finally, the mechanism received the green light from Brussels this Wednesday and has been initialed this Thursday by an order of Ecological Transition for its implementation.

Entry into force of the Iberian exception

On Tuesday the first auction is held in the Iberian wholesale electricity market with the price of gas limited, an intervention authorized and supported by Brussels pioneer in Europe and seeks to reduce between 15 and 20%

the price of light for more than ten million users in Spain.

After Brussels has given its approval and the Royal Decree-Law by which Spain has introduced this mechanism, which will also have Portugal, has been validated in Congress, the first auction with a ceiling price for gas, the most expensive production technology and responsible for the fact that electricity prices have been soaring for more than a year now, will take place on Tuesday, the 14th

.

The reference price of gas during the first six months of application of the mechanism, which will be in force until May 31, 2023

, will be 40 euros/megawatt hour (/MWh), and will increase by five euros per month thereafter, to end at 70 /MWh, so that when the end of its application approaches it will be close to converging with normality.

The electricity producers with combined cycles will be compensated for the difference between the price of natural gas in the Iberian Gas Market (Mibgas) and the limit established by the Government

.