The Government will intervene in the electricity market to lower the price of electricity

The Ministry of Ecological Transition already has the green light from the European Union to be able to intervene in the wholesale electricity market. The European Commission will study all possible options for emergency measures in order to limit the contagion of gas prices on electricity prices, such as temporary price caps. | Editorial: Gas stops marking the price of electricity.

In addition, it will study options to optimize the configuration of the electricity market, taking into account the final report of the Agency for the Cooperation of Energy Regulators (ACER) of the EU -which should be known next April- and other contributions on the pros and cons of alternative pricing mechanisms, in order to keep electricity affordable, without disrupting supply and without further investment in the green transition.

With this scenario on the table, the Ministry of Ecological Transition is already working on a package of measures that will be known shortly where it is expected that the first steps to limit energy prices will already be taken. Teresa Ribera’s department is preparing an extension of the so-called clawback of gas, which expires at the end of this month, until next October.

The measure was initially included in Royal Decree 17/2021 and generated a deep stir due to its impact on company contracts. The Government then softened the conditions in exchange for avoiding complaints and for the electric companies to offer prices to the large industry that have not yet been produced.

Now, with the European guarantee, the Government will be able to increase the measures so that the weight of the gas price has a lesser impact on the so-called PVPC, the regulated rate. Likewise, the Executive is preparing the primary energy auction that should have been carried out last year and already has the approval of the renewables employers to advance a review of the regulatory semi-period of the so-called Recore.

With all these measures, the Executive hopes to contain the impact on consumers of the energy crisis that is being experienced without compromising the development of renewables. The Executive is also working on the launch of the first offshore wind energy auction in the Canary Islands for nearly 300 MW.

The EU state aid rules will also offer Member States options to provide short – term support to businesses affected by high energy prices and help reduce their exposure to energy price volatility .

Midcat support

On the other hand, the Midcat project continues to encounter significant reluctance on the part of France to be able to start it. According to sources consulted, this infrastructure could start within a year and a half if it received funding from the European Commission.

The Council approved last December to stop financing natural gas interconnections, which would make this path difficult despite the express request made by the Government with the support of Portugal. In Spain, however, doubts have begun to arise because it is believed necessary to have long-term contracts to prevent it from being a stranded infrastructure after the current crisis.