Ribera Reforms The PVPC And ‘Forgets’ The Energy Auction For Industries

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The Ministry of Ecological Transition has put on the table the reform of the PVPC regulated rate and has forgotten the requirement to link 10% of this price to the result of the inframarginal energy auction that should have been held already in 2021 for small marketers and industrial.

The Government thus tacitly accepts the opposition of the electricity companies to this auction, although it includes in the draft that it has sent for public consultation the possibility of modifying, a posteriori, the current proposal with a ministerial order to maintain the validity of the corresponding article of the Royal Decree -Law 17/2021 and hold said auctions.

The Government’s reform proposal foresees that in a period of three years a distribution will be fixed in which the monthly product represents 10% of the total , the quarterly product 36% and the annual product 54%, which in the practice excludes the sale of this amount of energy despite reports from the CNMC that recommended that it be carried out to introduce a higher level of competition.

Lower volatility
The design of the future regulated tariff significantly reduces volatility while maintaining a price signal, as required by Directive 2019/944 to guarantee market efficiency.

The Government also ensures that the measure is carried out at an ideal time, since the Iberian mechanism has allowed a sharp reduction in prices in wholesale markets that is transferred to the figures used to set these price signals during the next years. The electricity companies had opposed this energy auction on numerous occasions because it meant breaking current contracts.

Generation companies usually contract with the marketers of large integrated companies for the sale of energy every year and any change in this regard could cause the companies to have to alter their contracting systems if it was not foreseen sufficiently in advance.

At the moment, the electricity companies are offering lower prices than the small marketers, which represents a loss of incentive for the Government to alter this situation, which is causing a strong setback in the liberalization process.

Small marketers lament the loss of customers who are suffering from the sharp increase in prices and the difficulties they are encountering in contracting energy and making coverage in recent months due to the sharp increase in prices.

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