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The Spanish may assume 600 million more than the Portuguese for the cost of the gas cap.

Spanish consumers’ can assume about 600 million euros more than the Portuguese in costs for the application.iberian surplusA mechanism to…

By admin , in news , at May 25, 2022

Spanish consumers’ can assume about 600 million euros more than the Portuguese in costs for the application.iberian surplusA mechanism to limit the price of gas to an average of 48.8 euros per megawatt/hour (MWh) for electricity generation over a 12-month period, according to industry estimates Europa Press.

that’s because term contract extension Electricity in Spain is not exempt from paying the cost of adjustments to the gas cap, unlike Portugal, which does not include these extensions in its decree, although according to sources in the region, this may be a posteriori. .

In particular, while the Royal Decree-Law published by the Government of Spain in the Official State Gazette (BOE) on 14 May holds that Fixed-price contracts that have been extended will pay this cost.In the case of Portuguese regulations, the extension is not included as the model on which compensation will be applied.

An extension consists of an automatic or tacit extension of the contract. Thus, the term of the agreement is extended, but the price and the rest of the terms remain unchanged.

In their favor, a renewal occurs when both parties expressly agree to extend the contract, and this may involve a change in price or any other condition.

In case of contracts with industrial customers, they usually last for one year, and when they expire we have to talk again, However, contracts with domestic customers, although technically their duration is one year, are treated as indefinitely and are extended unless the customer communicates his intention to terminate it .

According to preliminary estimates of the region, MIBEL – the demand for B2C at a fixed price in the Iberian electricity market (small customers) – equates to approximately 73 gigawatt hours (GWh) of 300 GWh -260 GWh (87%). Spain and 40 GWh (13%)- from Portugal.

Thus, about 63 GWh of Spanish is demanded from Spanish domestic customers. will end the funding of the measureWhereas Portugal has 10 GWh which will be exempted.

As funding of the measure is gradually done, it can be estimated that the Spanish account for 31.5 GWh of demand, almost half of what finances the measure, while Portuguese consumers do not.

Therefore, if The average compensation is around 20 euros, this would mean around 600 million euros Compensation that Spanish customers will pay more. The total cost of compensation will be slightly higher than approx. €3 billionAccording to industry data.

Combined Cycle Compensation

On 13 May, the Spanish government, in an extraordinary council of ministers, approved a mechanism to limit the price of gas for electricity generation to an average of 48.8 euros per megawatt/hour (MWh) over a period of twelve months, thus Covered next winter, a period in which energy prices are more expensive.

With this mechanism, gas thermal plants, combined cycle, will continue to charge what is needed to guarantee the power supply. This cost will be passed on to the consumers who benefit from this measure at any point of time and will always be less than the ultimate savings provided by it.

However, the measure, which was published in the BOE on 14 May, is still pending a formal decision from Brussels and is being signed by a ministerial order for its application.

The Spanish may assume 600 million more than the Portuguese for the cost of the gas cap.

2022-05-25 10:04:30