Only a day after a then-all-time high of €141.71 per MWh, yet another record will be set on Friday – the 12th time prices have skyrocketed since mid-July. The previous record before then was in January 2012 at €103.76 per MWh.
While the average price throughout the day will be €152.32 per MWh, 7.5% higher than Thursday, it will peak at €159.31 from 9 am to 10 am, and be lowest from 5 pm to 6 pm when it will cost €146.29.
It will cost 10.6% more to use appliances or turn on the light on Friday than a week prior when electricity prices averaged €137.7 per MWh.
Electricity will cost a staggering 237.7% more this Friday than exactly a year prior when prices averaged €45.10 per MWh following a pandemic-related slump.
Spain will not regulate market
This Spanish government recently stated that it would not step in to regulate prices.
In a four-hour appearance before Congress, Spain’s ecological transition minister, Teresa Ribera, said that doing so would be “against EU law.”
Yet, she also recently stated that her government is considering lowering the tax on electricity in order to ease the impact on households. In late June, Madrid already decided to lower the VAT for electricity from 21% to 10%.
Attributed to the rising cost of the gas used by combined cycle power plants as well as carbon emission trading and the limited use of renewables, electricity is now much pricier than it was a year ago when prices decreased following a drop in demand during the height of the pandemic.
Experts warn that soaring prices are not going away any time soon. José Bogas, CEO of Endesa, the largest electric utility company in Spain, said in an interview that high prices will remain until the second quarter of 2022.
According to him, this phenomenon is neither the government’s nor the companies’ or the customers’ fault. He argues that the same trend is happening across Europe, but that it is “slightly” greater in Spain due to the use of air conditioning.
New tariffs came into force on June 1, with higher, middle, and cheaper rates.
Spain’s competition regulation authority (CNMC) expressed concerns that some companies made the most of these changes by raising prices by up to 30% more than what the tariffs allow without warning their customers.