The daily price of electricity in the wholesale market will mark its fourth consecutive record on Thursday: it will reach 115.83 euros per megawatt-hour (MWh), the highest level ever recorded. This escalation, which already left July as the most expensive month in history, has moved onto the political terrain and has unleashed a fight between the government and the opposition. While the Popular Party has accused the Executive of not having any plan to stop the upward spiral and has requested an appearance from the Minister for the Ecological Transition, Teresa Ribera, the Government has blamed the previous presidents of the PP for the exorbitant prices that they are seeing each other in recent weeks.
The Minister of Finance, María Jesús Montero, pointed out on Tuesday directly to the executives of José María Aznar and Mariano Rajoy, whom she accused of having charged “the impulse of alternative energies” and of being responsible for “what is happening today ”, according to statements collected by Europa Press. “If the bet that the Zapatero Government made in its day had been continued with the Government of Mr. Rajoy, today we would not be witnessing this exorbitant price of energy because there would already have been the capacity to generate renewable energy, store it and distribute it as the Government is working at the moment ”, he added.
The president of the PP, Pablo Casado, has promised this Wednesday that when he arrives at the Government he will make a law so that consumers pay only for the energy consumed – which currently only represents a third of the final price of the receipt – and has charged against President Pedro Sánchez for not accepting this proposal at a time when “the price of electricity is triple that of a year ago.”
Also the secretary general and the deputy secretary general of the PP, Teodoro García Egea and Pablo Montesinos, have criticized the Government for this matter. Montesinos has asked that Sánchez give “his face” and put an end to the “scandalous” rise in the price of electricity. “He must face all Spaniards, appear publicly and propose a shock plan against the scandalous rise in electricity. It is your obligation, “he claimed on Antena 3.” And if you do not know or do not want to respond to this crisis, what you have to do is call early elections now and give way to those who do have a shock plan against the rise in the light. The government’s response cannot be to insult the PP and blame Europe ”, he added.
Prices at maximum
The heat wave of recent days has increased demand and is pushing up prices that are already skyrocketing in all European countries. The main culprits for this increase are gas, which is trading through the roof in international markets, and CO₂ emission rights, at the highest since May. And the futures markets suggest that the situation will remain tense until at least the spring of next year.
This upward spiral directly affects consumers who have contracted the regulated tariff or PVPC (voluntary price for the small consumer), which is indexed to the wholesale market ―power consumption represents only about a third of the final price of the bill―, but it also determines the offers that the free market traders propose to their clients.
The Executive already adopted at the end of June provisional measures to alleviate the impact of the escalation on consumers’ pockets, with the reduction of VAT from 21% to 10% for six months and the suspension for a quarter of the tax on electricity generation , which companies pay but which have an impact on customers. There are also two significant structural measures on the table that, when they come into force, will lower the bill: limit the overpayment of non-carbon dioxide-emitting plants and remove the premiums for renewables from the bill. Meanwhile, analysts say, these high prices will have to get used to.