Although Ribera trusts the EU’s action with other far-reaching measures, he is studying a new calculation to separate him from a rate that remains on record
The third vice president and minister of Ecological Transition, Teresa Ribera, indicated this Tuesday that the Government is still pending the recommendations launched by Brussels on energy matters “without prejudice to the complementary works” that can be promoted from each of the States. And in that sense, her department works “to strengthen the position of vulnerable consumers,” according to government sources to this newspaper.
In practice, it is a new twist to the social bond, the discount of up to 70% on the part of electricity consumption enjoyed by 1.2 million vulnerable households in light consumption. The change would involve linking the electricity tariff for this group to a new model in which a reasonable electricity price is established, whose range is analyzed between 50 and 60 euros/MWh. The light is this Wednesday close to 500 euros/MWh. Thus, they would see their monthly bill substantially reduced, compared to the average that, only so far this month, will mean paying more than 300 euros/MWh if March ends with the current prices.
A week ago, the Government decided to extend the extraordinary conditions of the electricity social bond. The problem that consumers covered by the social bonus are finding is that the high cost of electricity has eaten up the help they were benefiting from, by far exceeding those discounts, which in many cases are imperceptible for higher bills at 100 or 200 euros.
Who pays the 200 million
To reform the social bonus, the Government will also have to undertake how it will be financed, as it is a measure that involves an expense of around 200 million euros each year. Until now, it was paid by all electricity marketers (regardless of their size or the market in which they operated), although the Supreme Court ended this system, considering it discriminatory, without proposing an alternative, which is pending application by the Executive.
Ecological Transition is also studying applying a review of the remuneration received by renewable power plants, whose generation cost does not even come close to current prices. The Government has already reached an agreement with the green associations so that the adjustment of profits is brought forward a year and stop charging the extra benefits caused by high prices from the moment the decree becomes effective.
Meanwhile, the price of electricity is still in the maximum zone, despite having given a slight respite for this Wednesday. The average price of electricity in the wholesale market falls by 13.2%, but continues to shoot up and will mark its second highest record in history with 472.97 euros/MH, a situation that occurs in the heat of the upward spiral of the natural gas due to the impact of the war in Ukraine. There will be sections in the afternoon, such as the one that begins at 8:00 p.m., in which it will rise to 600 euros/MWh.
The germ of this electrical spiral continues to be in the price of gas, which came close to 300 euros/MWh on Tuesday, although it was later relaxed to 190 euros/MWh. The gas is necessary to activate the combined cycle plants, the last ones to enter the electrical system -as they are the ones with the highest energy cost- to guarantee the supply and demand of the entire system, and which represented 19% of the Spanish energy mix, according to REE.
Eddie is an Australian news reporter with over 9 years in the industry and has published on Forbes and tech crunch.