The price of electricity continues to fall and drops by 40% this Sunday, to 30.4 euros/MWh

Energy will cost 0 euros/MWh, and even negative prices, between 9:00 and 20:00

Jul 20 () –

The average daily price on the wholesale electricity market, known as the ‘pool’, will drop by 40% this Sunday compared to Saturday, to 30.4 euros per megawatt (MWh) after the price rose to 100 euros on Thursday.

Specifically, the average for the ‘pool’ on Sunday will be 30.4 euros/MWh, with a maximum of 95.44 euros/MWh, between 10:00 p.m. and 11:00 p.m., and a negative minimum of 0.25 euros/MWh, between 2:00 p.m. and 3:00 p.m., according to data from the Iberian Energy Market Operator (OMIE) collected by Europa Press.

In fact, energy will cost 0 euros/Mwh, and even at negative prices, between 9:00 and 20:00 hours.

The week, marked by the first heat wave of the summer, led to an increase in the price of electricity on Thursday and Friday to around 100 euros, although the arrival of the weekend – when consumption falls – and the drop in temperatures have led to a drop in the price of raw materials.

It is worth noting that the wholesale market price exceeded the 100 euro/MWh mark this past Thursday for the first time since January 9, when it reached 113.83 euros/MWh.

The heat wave, the first of this summer, has thus left prices particularly high for this week, taking into account the behaviour of the electricity market in 2024, in which in April the first negative prices in history were recorded in the ‘pool’ due to the majority presence of renewables – solar, wind and hydraulic – in generation, which have led to prices collapsing at many times.

Specifically, April ended as the month with the lowest electricity price in history since the wholesale market was launched, with an average of 13.67 euros/MWh.

AVERAGE OF MORE THAN 60 EUROS/MWH SO FAR IN JULY

So far in July, the daily wholesale market price has stood at 63.68 euros per megawatt hour (MWh), 13.5% higher than last month.

Thus, the upward trend that began in June has continued, after a spring with extraordinarily low prices, but slowed down by the impact of photovoltaic energy.

According to analysts at Grupo ASE, this is a very moderate increase because in the central hours of the day prices have fallen by 24% compared to June.

Specifically, photovoltaics has produced 26% of electricity, leading the generation mix, covering up to 50% of demand in the central hours of the day and thus lowering the price during solar hours, softening the upward trend in prices.

However, analysts at the consultancy warned that weather forecasts for the end of the month indicate that wind power generation will slow down and remain below average, while temperatures will rise sharply, increasing demand by 6% and causing a spike in electricity prices.

This increase in the ‘pool’ will affect customers of the regulated electricity market or PVPC, who are impacted by these daily price fluctuations.

It should be remembered that the ‘pool’ does not exactly represent the final amount of the price of electricity for a consumer covered by the regulated tariff, since with the entry into force of 2024 a new method of calculating the PVPC was adopted, which incorporates a basket of medium and long-term prices to avoid strong fluctuations, without losing the short-term price references that encourage savings and efficient consumption.

In this way, the proportion of the link to the pool price will be progressively reduced to incorporate the references of the futures markets, so that these represent 25% in 2024, 40% in 2025 and 55% from 2026.