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ARCHIVED - March electricity prices break all-time Spanish and European records
The cost of electricity in Spain is 523.32% more expensive than a year ago
Russia's invasion of Ukraine has had a catastrophic impact on many commodities, but not least the cost of household energy bills as electricity costs continue to skyrocket reaching the highest levels ever recorded in Spain and the rest of Europe.
The situation has escalated to such an extent that March will go down in history as the month when the cost of electricity to consumers reached unprecedented heights, hiking a staggering 24% since the start of the war in Ukraine on February 24.
The average billpayer in Spain saw prices soar by an eye-watering 523.32% compared to March 2021 as average wholesale costs peaked at 283.30 euros per Megawatt hour (MWh), the highest monthly figure since records began.
This figure is more than 40 euros/MWh higher than in December, the previous most expensive month on record, driven by the conflict in Ukraine.
It's a small relief, but on Thursday March 31, ironically the last day of the month, the price fell marginally by 6.43%, meaning a day-to-day comparison shows the price of electricity is 333.95% more costly than on March 31 2021.
Between 8am and 9am, consumers were looking at paying 290.57 euros/MWh, compared to 175.65 euros/MWh between 5pm and 6pm, according to data published by the Iberian Energy Market Operator (OMIE).
Ahead of Russia's unilateral invasion on February 24, the wholesale market price of electricity was 205.6 euros/MWh and, since then, the price has climbed daily, hitting its peak on March 8 when the record 544.98 euros/MWh was reached.
All of this means that during the first quarter of 2022, the average wholesale price stands at 229.37 euros, i.e. more than double the record of 2021, which was the previous most expensive year with an average of 111.93 euros.
Elsewhere in Europe, average electricity prices will exceed Spain's extortionate costs: In France (294.20 euros/MWh); Italy (281.90 euros/MWh); and the United Kingdom (281.84 euros/MWh); whilst in Germany, it will remain at 209.19 euros/MWh.
Wholesale or 'pool prices' have a direct impact on the regulated tariff – the so-called PVPC – to which almost 11 million consumers in Spain are subscribed, and serve as a reference for the other 17 million who have contracted their supply in the free market.
According to the National Markets and Competition Commission (CNMC), in 2021, as part of the upward spiral of energy costs, around 1.25 million people switched from the PVPC to a fixed-price free-market tariff.
To alleviate the effects of rising energy costs in Spain, President Pedro Sánchez has announced a battery of measures including a cap on the price of electricity in the wholesale market and electricity company profit margins.
Image: Wikimedia Commons
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