Endesa’s CEO, Jose Bogas, warns of the “significant rise” that millions of domestic consumers will notice in the electricity bill for this month of January, especially those covered by the PVPC -former regulated tariff- whose bill is indexed directly to the wholesale market of the light.
This market has experienced a strong increase in prices in recent days that places it at unknown levels at this time of year since 2017. The Government has reacted by requesting an in-depth investigation of the National Commission for Markets and Competition (CNMC), although sources close to the vice president Teresa Ribera they believe that it is a “conjunctural episode” and they trust that the price will stabilize in the next few days.
Large electricity companies take away the iron from the rise and link it to market factors such as the increase in the price of gas worldwide or the low production with renewables in Spain due to the absence of wind and sun, which forces burn gas or coal reserves with a higher price. The higher cost of CO2 emission rights also plays a role.
In this sense, these price peaks are actually an opportunity for these companies to accelerate the transfer of customers from the regulated market (PVPC) to the liberalized market, where hundreds of electricity traders can offer a fixed or stable electricity price for a specified period. These offers imply greater stability in the receipt, but according to the CNMC they end up being more expensive in the long term compared to the PVPC.
At present, 14 million households they have their electricity bill indexed directly to the wholesale cost per megawatt-hour. 11 million of them are covered by the PVPC rate, while another 3 have contracted a rate indexed to the same market in the liberalized market.
“The gas shortage, the increase in demand or the price of CO2 automatically lead to very high prices at this time. In Spain we have the regulated tariff, directly linked to the wholesale price, and this leads to that the rise is important “, has warned Bogas during his participation in a meeting of Nueva EconomÃa Forum.
The words of the chief executive of Endesa clash directly with those of Vice President Ribera, who in statements to El PaÃs tried this weekend to remove iron from the rise, assuring that it would be “relative” and of “a few euros”.
In Bogas’s opinion, “electricity in Spain is expensive, but not because of the generation or distribution market, but because of the loads assumed by the electricity sector and that it makes no sense to pay alone “. It refers to the cost of public aid for renewables that were installed in the first decade of the century, for an annual amount of 7,000 million euros. In this sense, the CEO of Endesa has applauded the Government’s intention to distribute this cost among other energies such as gas or oil to give a better price signal that promotes the decarbonisation of the economy.
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