The average daily price of electricity in the wholesale market will fall this Saturday by 5.97%, thus cutting the series of three consecutive increases and relaxing to 110.14 euros per megawatt hour (MWh).
In this way, the price of electricity in the electricity pool is somewhat far from the records with which it has flirted this Friday, with an average price for the day of 117.14 euros / MWh -the second highest of the historical series-.
This slight drop is due to the fact that electricity prices are always cheaper on weekends, due to lower demand, since the price will be especially high for a Saturday, with only 114.63 euros / MWh from last week above for this day of the week.
The electricity pool will register for this Saturday a minimum of 91.2 euros / MWh -between 5:00 p.m. and 6:00 p.m.-, while the maximum schedule will be between 10:00 p.m. and 11:00 p.m., with 123 euros / MWh, according to data from OMIE collected by Europa Press.
Thus, despite this drop for Saturday, the price remains at especially high levels. With respect to a year ago, the average level for tomorrow multiplies by a little more than three the more than 32 euros / MWh that was registered in 2020 at this time.
One record after another
So far in August, the ‘pool’ has smashed all the records seen so far, pointing, when it has already exceeded its equator, at an average price for the month above 100 euros / MWh. The first five days of last week marked a maximum figure after another, with that historical level, until now, on Friday, August 13, of an average daily price of 117.29 euros / MWh.
Last week’s upward spiral led the political debate to focus on how to lower the price of electricity. In fact, the Government opened the door to create a public energy company, as has been requested for a long time by its partner in the Executive, United We Can.
This context of increases in the electricity pool is marked by the increase in the prices of CO2 and gas rights, to which the increase in demand due to the heat wave has been added.
Specifically, CO2 emission rights have become more expensive to exceed 55 euros per tonne so far in August, when at the beginning of the year they were trading at around 33 euros. Meanwhile, the price of natural gas is around 42 euros per MWh, according to Mibgas data.
The price of energy has a close weight in the bill of around 24%, while around 50-55% corresponds to tolls -the cost of transmission and distribution networks- and charges -the costs associated with development from renewables, to non-peninsular ones and the annuities of the tariff deficit- and the rest, to taxes.
The fluctuations in the daily price affect consumers covered by the regulated tariff (PVPC), just over 10 million, while those in the free market are exempt -about 17 million-, since they have an agreed price with your company.
According to experts from the sector told Europa Press, 88% of electricity consumption in Spain is not exposed to the volatility of the price of the ‘spot’ market, as they have contracts with fixed prices, thus being exposed to customers under the PVPC.
On June 24, the Government approved a Royal Decree-Law as a matter of urgency to reduce the taxes applied to the supply of electricity and, with it, the electricity bill of homes, the self-employed, SMEs and all of companies, which entail the reduction of VAT on electricity from 21% to 10% until the end of this year and the suspension of the 7% tax on electricity generation for three months.
In the specific case of VAT, a 10% reduction is applied until the end of the year for all consumers with contracted power up to 10 kilowatts (kW), provided that the average monthly price of the wholesale electricity market is above 45 euros per MWh.
Regarding the suspension of 7% of the tax on the value of electricity production, which already in 2018 was decided to temporarily suspend for six months to contain another upward wave in the price of electricity, will be in force during the third quarter of this year.
The most expensive bill in history
In fact, the electricity bill of an average user in August will be “the most expensive in history”, with an increase so far this month of 43.7% compared to the same period last year, according to data from Facua-Consumidores en Acción.
According to estimates by the consumer association on the evolution of the semi-regulated tariff (PVPC), the first 15 days of August reflect a monthly bill for the user of 91.62 euros, with that rise of almost 44% compared to 63 , 77 euros in August of last year, despite the reduction in VAT from 21% to 10% approved by the Government for invoices issued from June 26 to the end of the year.
To date, the five highest receipts have been the 88.66 euros for the first quarter of 2012 (with VAT at 18%), the 87.81 euros for January 2017, the 85.34 for July 2021, the 83.55 euros in September 2018 and 82.13 euros in May 2021 -in all cases with VAT at 21% -, according to data from the association.
With the rates applied from August 1 to 15, the average user will pay 27.85 euros more than in August 2020, when the bill stood at 63.77 euros. The reduction in VAT to 10% until December while the average price per megawatt hour is above 45 euros dampens the rise by 9.16 euros. If 21% were still applied, the receipt would have reached 100.78 euros.
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