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The price of electricity falls 22.6% this Wednesday with the application of the gas cap

The average price of electricity in the wholesale market will fall 22.

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The price of electricity falls 22.6% this Wednesday with the application of the gas cap

The average price of electricity in the wholesale market will fall 22.6% tomorrow compared to this Tuesday, on the first day of application of the so-called 'Iberian exception' to cap the price of natural gas for electricity generation.

The average price of electricity tomorrow, Wednesday, will be 165.59 euros/MWh, which is 48 euros less than today's price (214.05 euros/MWh) and its lowest level since last May 29, according to the data published by the Iberian Energy Market Operator (OMIE) and collected by Europa Press.

The maximum price of electricity for this June 15 will be registered between 01:00 and 02:00, with 194.07 euros/MWh, while the minimum for the day, of 144.17 euros/MWh, will be registered between 16:00 and 5:00 p.m. In this way, there will be no time slot throughout the day that exceeds 200 euros/MWh.

The mechanism, which finally received the green light from Brussels last week, limits the price of gas for electricity generation to an average of 48.8 euros per MWh over a twelve-month period, thus covering the coming winter, a period in which that energy prices are more expensive.

Specifically, the 'Iberian exception' sets a path for natural gas to generate electricity at a price of 40 euros/MWh in the initial six months, compared to around 80 euros/MWh at which natural gas is quoted in Mibgas, and subsequently, a monthly increase of five euros/MWh until the end of the measure.

The Government limits in its calculations to 15.3% the reduction to the average electricity consumer covered by the PVPC regulated rate during the 12 months of application of the approved cap on the generation of electricity from natural gas, according to the report of impact that accompanies the decree law and to which Europa Press has had access.

For the industrial consumer, totally exposed to the 'spot' price, the Government estimates a reduction of between 18% and 20%, the first month of the mechanism oscillating between 15% and 17%, and between 13% and 15% at last.

However, despite this significant drop in the 'pool', compared to a year ago, the average price of electricity for this Wednesday will be 82% more expensive than the 90.95 euros/MWh of June 15, 2021 .

The prices of the 'pool' have a direct impact on the regulated rate --the so-called PVPC--, to which almost 11 million households in the country are covered, and serve as a reference for the other 17 million who have contracted their supply in the free market.

In fact, the National Commission of Markets and Competition (CNMC) has verified that in 2021, in the framework of the upward spiral of energy, around 1.25 million people switched from the PVPC to a rate in the free market at a fixed price.

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