Spain waives the cap of 180 euros per megawatt hour in the wholesale electricity market | Economy

Spain will not take its initial proposal to cap the wholesale electricity market at 180 euros per megawatt hour (MWh) to the European Council this week. “That option has been ruled out. It is not the extent to which we have been working in recent days,” government sources confirm to this newspaper after The Energy Newspaper The decay of that initial proposal, in which the Spanish and Portuguese governments went hand in hand, was revealed this Monday.

Script twist three days before the summit of heads of state and government from which a European agreement should come out to stop the energy escalation. If last Thursday the third vice president and minister for the Ecological Transition considered that limit “little debatable”, this Monday that measure is not in the list of proposals that the Spanish Executive will take to Brussels on Thursday and Friday. The important thing, they insist, is not so much the how, but the what: that what comes out of the European Council serves to stop the brutal rise in prices in recent months.

The change in position comes after Germany, the Netherlands and other northern European states flatly ruled out accepting such a measure, which the European Commission did not like either. Italy, for its part, focuses on limiting the price at which plants that generate electricity by burning natural gas can offer, an option that Spain does not see with bad eyes.

Faced with the refusal of the northern partners, who have set a red line at the top of the wholesale market, Spain prefers to explore alternative routes that are acceptable to all and that can lead to an agreement. The limit of 180 euros per MWh was active until July last year, when the Spanish authorities had to raise it to 3,000 euros —an unimaginable figure, which the market will not reach no matter how much natural gas continues to rise— in application of a community directive.

Whether there is an agreement at the summit or not, the Government has promised to include in its decree on the 29th a battery of measures to reduce the price of electricity and fuel, which could even include some retroactivity formula, according to sources officers.