The storm Filomena fueled the beginning of a 2021 in which no one could prevent what would happen as of June: a climbing of the unprecedented price of electricity that reached close to 400 euros per megawatt-hour a few days ago, something unpredictable a year ago. The abstract is an annual average award of € 111.93 per megawatt-hour, almost double the 57.29 euros per megawatt-hour of 2018. But its effect on consumers’ pockets will not be such, it has been contained in part by the reductions in taxes and charges, although there are at least 9 million consumers will pay more this year than then.
After the storm, the average monthly price of electricity closed in January at around 60 euros, calm arrived, in February it cost an average of 28.49 euros. But it was from June (83.29 euros on average) when it began to run wild, until in August it exceeded 100 euros per month. Since then, the average increase per month was 50 euros, less in November, which remained around 200 euros, which had reached its maximum in October.
A) Yes, December has ended like the month most expensive ever (239.17 euros on average per megawatt-hour) in a year in which up to 26 daily historical records. The first was on July 21, when the wholesale price rose to 106.57 euros per megawatt-hour, surpassing for the first time the maximum of 103.76 euros on January 11, 2002, while the last was on Thursday. December 23 when it reached 383.67 euros per megawatt-hour. That day, in addition, an hourly record was registered, since between 8 and 22 hours, throughout the day, the price exceeded the level of 400 euros.
The reason: the very high price of natural gas in international markets, which went from 15 euros last year to 180 euros, which this December reached and which was coupled with very high prices for CO2 emission rights (in 2018 they were paid at 17 euros, now to 80). Both variables have achieved a price nonsense in the wholesale market that would be inconceivable and even impossible a year ago because until July the maximum and minimum price that could be registered in the wholesale market was between 0 and 180 euros, while since then it has been between – 500 and 3,000 euros for converge with Europe.
The bill will go up
The price of electricity is together with regulated costs (tolls and charges) and taxes, one of the three parts of the bill. To prevent this from runaway at the rate of the wholesale price, at the end of June, the Government reduced the VAT on electricity from 21% to 10% until the end of the year and suspended the tax of 7% on electricity generation for three months. But the exorbitant rise in electricity in summer caused a new package of measures in September that included the extension of the suspension of the generation tax and the reduction of special tax on electricity from 5.11% to 0.5% until December 31. As well as a reduction of the 96% of the charges included in the invoice.
Everything to achieve the objective set by the President of the Government in a interview in The country in which he promised that “All” consumers would pay by the end of 2021 a invoice similar to 2018. Something that will not happen because, at least, around 9 million consumers of the regulated market with a PVPC tariff (historically the cheapest, according to the vice president herself, in the first half of this year the PVPC rate was on average 20% cheaper than the free rate) will pay more.
This is clear from the calculations of the energy expert Francisco Valverde, for a consumer with a PVPC tariff with a power of 4.4 kilowatts and a consumption of 3,500 kilowatt hours per year (not including the meter rental), the price of the bill is 2021 has been 936 euros, 150 euros more expensive than 2018 (784 euros). That is to say, at least Most consumers in the regulated market will pay this year a most expensive bill than in 2018. Without the government measures, the final price would be 10% more expensive (without the June measures, the price would be 979, and without those of September, 1,039 euros).
This Wednesday, the President of the Government himself, Pedro Sanchez, recognized that there will be a 30% of consumers they will have a more expensive electric bill this year. In 2020 there were 29.7 million supply points, of which 10.9 million in the regulated market (the latter includes 1.2 million beneficiaries of the social bond) and 18.8 million in the free market. The latter are not known how much they pay because they are very different contracts between marketers and users that, moreover, are not public. As defended by Sánchez, the average number of consumers Spanish people will pay more or less the same than two years ago (613 euros, compared to 639 in 2018).
What will happen the year that now begins is quite a unknown. The futures market advances that prices will remain until spring in an environment very similar to those of recent months, and this is what the Government collected by extending its VAT and special tax reductions and the suspension of 7% to generation until April 31, in the first case, and until March 30, in the second. And the truth is that everything depends on whether the price of gas remains at those levels or not, that is, whether Russia turns on the tap or not.
The only certainty is that, in first days of january the invoice price will be more expensive than it is today. The Government has not extended the temporary reduction of charges from 96% in the last quarter, but has reduced it to 30% (tolls are down 2.5%). This change will also bring a new consequence: the return of the time sections, now almost imperceptible.