The Council of Ministers will approve this Tuesday a Royal Decree-law with the aim of reducing the price of the invoice in full escalation of electricity prices in the wholesale market. In the shock plan that will be given the green light today, the Executive will include a measure to limit the increase in the rate of last resort (TUR) for natural gas for two quarters, according to the Royal Decree-law to which ABC has had access . The objective, as established in the regulations, is to cushion the receipt of domestic consumers “the exceptional rise in international prices for natural gas.”
Thus, the Executive calculates that by entering to regulate the gas rate, a rise in the bill of an average household that could reach 30-40% depending on the consumption band will be avoided. The Government emphasizes in the decree that the price of electricity, which affects the self-employed, families, industries and the economy, is closely linked to the evolution of the price of natural gas in international markets.
In addition, the Government will approve market mechanisms that “promote the forward contracting of electricity as long as the degree of competition and liquidity in the forward markets so requires.” They will be long-term energy auctions that will be subject to specific conditions. And the generation linked to these auctions of long-term power purchase contracts will correspond to a maximum of 25% of the lowest value of annual energy generated in the last 10 years of manageable infra-marginal facilities and non-issuers that do not receive specific remuneration and that have not been awarded in the renewable energy development auctions.
With these auctions, the Government wants to have another reference when establishing the price of electricity. According to the decree, the auctions guarantee competition between the energy buyers on an auctioned basis. The Executive also establishes a series of conditions to be a buyer in these auctions.
At the same time, the norm ensures that with these bids, which will be supervised by the National Commission of Markets and Competition (CNMC) the principle of reasonable profitability is guaranteed (as a manifestation of the principle of legal certainty) of the energy supply agents through the establishment of a reserve price that will be determined through a methodology.
The Executive will also modify the figure of the vulnerable consumer through the social bond. To begin with, the marketer will have to require, 15 before the expiration of the period established in the process of suspension of supply, payment to the consumer if he has not done so. In addition, vulnerable consumers who have not paid the bill in four months will have another four more months of supply, although this will be limited to 3kW. During this period, the marketers will not be able to cut their supply.
Before the foreseeable legal battle thatEu will raise the energy sector for the approval of these measures, the Government defends that its decree is “constitutionally lawful” due to the emergency situation that the electricity market is experiencing, which in August experienced the most expensive month in history and is currently exceeding 150 euros per megawatt hour.