Wednesday, February 15, 2023, 01:07
The price of electricity rises again today, one more day. After a slight respite for the pockets of consumers for just one day, electricity costs are once again on the rise. Thus, this Wednesday, February 15, the bill grows by 1.45% to stand at 142.59 euros/MWh, according to the data communicated by the Iberian Energy Market Operator (OMIE).
Hence, experts recommend that consumers pay attention to what are the most beneficial hours for their pockets when starting up the appliances with the highest energy consumption. Energy saving specialists advise families to ensure that unused appliances remain unplugged, take short showers and, among other saving measures, pay attention to the five household appliances that consume the most electricity and whose consumption is most noticeable in the final electricity bill: the dryer, the dishwasher, the refrigerator, the washing machine and the television.
All this occurs in a context of high prices that the consumer notices every time they have to buy a product, especially in the daily shopping basket. In this sense, a study carried out by the Facua consumer association confirms that “the VAT reduction on food is still not being applied correctly in large stores.” The report has analyzed more than a thousand prices in the eight largest supermarket chains to verify that 178 of the 1,020 products with reduced VAT are now sold more expensive than before the Government’s tax measure was applied. However, the Government continues to maintain that the data it handles support the effectiveness of said reduction.
Contribution of renewable energies
The lowest electricity prices in January were possible thanks to the weather conditions with abundant rains that have filled the swamps, added to the abundance of wind throughout the peninsula. Thus, according to Red Eléctrica, so far this year the vast majority of days the production of green energy has far exceeded the rest of that generated in Spain, although this week it has fallen slightly. In this way, the average price of electricity for regulated rate customers linked to the wholesale market in the first 15 days of February stood at 132.46 euros/MWh, 66% more than the 79.75 euros/MWh of average for the same period last month.
Also the price of gas, lower at the end of the year, is helping to reduce bills in companies and homes. However, experts remain vigilant to one of the major factors that affect the cost of electricity, the price of gas, highly conditioned by the weather but also by the war in Ukraine.
Another factor that is undoubtedly helping to save in the budget of users of electricity rates is the mechanism of the ‘Iberian exception’ that establishes a maximum ceiling in the price of gas for electricity generation. Without it this Wednesday, the price of electricity in Spain would be an average of 147.85 euros/MWh, which is 5.26 euros/MWh more than with the compensation for customers of the regulated rate, who will thus pay 3 .56% less than average.
Price of electricity: extension of the Iberian exception
Precisely both Spain and Portugal have started the process to request Europe to extend the Iberian exemption beyond May, as planned. Third Vice President Teresa Ribera has shown her optimism that this be achieved after the meeting held with the Competition Commissioner, Margrethe Vestager. This mechanism has made it possible to lower the bill of households and companies by 4,577 million euros, according to the calculations of the Ministry for the Ecological Transition.
The countries of the European Union agreed in December to apply a ceiling of 180 euros per megawatt hour to imported gas. The mechanism will come into operation on February 1 and will be activated automatically as soon as the three set requirements are met: a price above 180 euros/MWh for three consecutive days and with a difference of 35 euros compared to other international markets. Once activated, the mechanism will apply for 20 days.
The Iberian mechanism impacts the price of gas used to produce electricity in combined cycle plants. In other words, initially the cap on European gas will not have an impact on the Spanish market.
Price of electricity today by the hour
The wholesale market electricity rate directly influences the final cost that the consumer has to pay to start up their household appliances hour by hour, hence the price of electricity is established at 142.59 euros/MWh once plus the corresponding charges and tolls.
ELECTRICITY PRICE TODAY WEDNESDAY, FEBRUARY 15, HOUR BY HOUR
-
cheapest hour
from one to two in the afternoon, 121.75 euros/MWh -
most expensive hour
from seven to eight at night, 175 euros/MWh.
Thus, today, Wednesday, the cheapest time to start up the appliances with the highest energy consumption will be from one to two in the afternoon, 121.75 euros/MWh, while the most expensive will be from seven to eight at night, 175 euro/MWh.
The effectiveness of the Iberian exception
The ‘Iberian mechanism’, which came into force on June 15, limits the price of gas for electricity generation to an average of 48.8 euros per MWh for a period of twelve months, thus covering winter, the period in which that energy prices tend to be higher. This mechanism was approved after the price of light reached a maximum of 700 euros per megawatt hour in March of this year. The so-called ‘Iberian exception’ sets a path for natural gas for electricity generation from a price of 40 euros/MWh in the initial six months, and subsequently, a monthly increase of five euros/MWh until the end of the measure.
The average price of electricity for regulated rate customers linked to the wholesale market was 212 euros/MWh in 2022 until June 15 (before the entry into force of the gas cap), while in the rest of the year ( taking into account the calculation with this exceptional mechanism) the average price was 208 euros/MWh. If this measure had not existed, the average price of electricity between June 15 and December 31, 2022 would have been 256 euros/MWh, that is, 23% higher than what consumers have paid.
The prices of the ‘pool’ have a direct impact on the regulated tariff -the so-called PVPC-, to which almost 11 million consumers in the country are covered, and serve as a reference for the other 17 million who have contracted their supply in the free market . For this reason, one more day the price of electricity will vary significantly from hour to hour throughout the day again, depending on the tolls and charges established in each of the hourly bands of the electricity tariff.
Tips for household appliances that consume the most
In all homes we have large electrical consumption appliances. According to a study by the OCU, the household appliances that require the most energy are, in this order: dryer, dishwasher, refrigerator, washing machine and television.
What consumers can do is make the most of the capacity of the refrigerators and adjust the thermostat between 4 and 6º, and above all avoid that the door remains open for too long. When choosing its location it is very important that the fridge is located away from the oven, a radiator or a sunny window or balcony.
Other tips that serve to save on the electricity bill are not leaving mobile chargers or headphones connected for longer than necessary, turning off devices that are not being used, not leaving the television on if it is not being watched, etc.
What consumers can do is make the most of the capacity of the refrigerators and adjust the thermostat between 4 and 6º, and above all avoid that the door remains open for too long. When choosing its location, it is very important that the fridge is located away from the oven, a radiator or a sunny window or balcony.