Government Admit That Electricity Will Rise By 25%

The unprecedented rise in the wholesale price of electricity will increase the average electricity bill of the 10 million homes of the PVPC regulated tariff by 25% , but the Government cannot intervene in the market in which said price is set. because the European Union does not allow it .

This was defended this Monday by the third vice president and minister for the Ecological Transition, Teresa Ribera , who has once again assured that the Government is willing to take measures to detach as much as possible the regulated tariff from the “volatile” wholesale market by creating a “basket of more stable indicators”, although it has admitted that greater stability could lead to a higher risk premium.

Before the ecological transition commission of Congress, Ribera has also supported the creation of a commission in the chamber to study the operation of the electricity market, as proposed by Más País-Equo, Compromís and Nueva Canarias.

In addition, it has confirmed that it plans to impose limits on the management that hydroelectric plants do of the swamps, as EL PERIÓDICO has advanced , after they have promoted a “scandalous” reduction in the level of several reservoirs .

“I think that here there has been no social empathy at all , that although it sounds like a joke, it is also listed on the stock market, ” he accused them. In addition, it has announced that the suspension of the 7% generation tax will be extended until the end of the year , which will equal the VAT reduction from 21% to 10%, and has maintained its plan to promote a “supply vital minimum ” for vulnerable consumers.

Ribera’s refusal to intervene in the wholesale price of electricity comes a few days after the executive’s minority partner, Unidas Podemos, proposed to create a fixed price for nuclear and a maximum for hydroelectric .

The minister has assured that she will present a “political battle” in Europe to achieve changes in community regulations, but that until then it is only possible to respect them. Likewise, he has warned that the public electricity company that has been created to manage the hydroelectric plants once the concessions expire – something that the purple formation celebrated as a victory – would be “subject to the same market rules” as the others and therefore it could not generate at lower prices.

” Social alarm can grow or decrease depending on how honest and correct we are in the diagnosis that we share with citizens. And I think it is worrying to generate confusion with messages that do not correspond to reality or to try to promote measures that are frontally contrary to European law .

It is something like asking the fishmonger to offer you beef tenderloin. As a Government, in terms of fishmongers, we will work very happy with the butchers, but we cannot offer the tenderloin that corresponds to another place in the market that is Brussels, “he argued.

Podemos has questioned that the Government cannot limit wholesale prices, but above all it has criticized the possible change in the regulated tariff to stabilize it by disconnecting it from the wholesale market.

“I suppose it will be to stabilize it downward , because stabilizing without further ado I don’t know what grace it would be,” his deputy Txema Guijarro has thrown at him. “What the vice president proposes is the same as the electricity oligopoly proposed a few days ago , and if the electricity oligopoly proposes it, it is difficult to believe that it can help lower the bill,” criticized her parliamentary spokesman, Pablo Echenique .

The minister, in any case, has tried to lower the alarm about the escalation of the wholesale price, which represents between 24% and 30% of the regulated invoice. Thus, he highlighted that a consumer in the regulated market paid an average of 598 euros in all of 2018, 562 euros in 2019, 512 euros last year (at a minimum due to the drop in demand caused by the pandemic) and, projecting current record prices ( triple those of a year ago), 644 euros in 2021 , that is, 25% more than last year. Also “a little less than 55 euros per month” , but in any case “important figures for some families”

The users benefiting from said regulated tariff, he added, have suffered an average increase in their receipt in the first semester of 6.9% , while consumers who are in the free market (about 17 million) have registered a reduction of 4 , 6% .

This difference is due to the fact that the regulated tariff is linked to the wholesale price, while in the free market, companies and their clients ‘agree’ on a fixed price in most cases (in the long run, however, it is foreseeable that also turn up when it’s time to review it) that has benefited from the tax cut. But even so, Ribera stressed, the PVPC rate was between January and June on average 20% cheaperthan those of the free market.

Against this, he defended, his ministry is promoting “structural” changes that will lower the bill by around 15% in the coming years: the creation of a fund to remove the cost of premiums from the receipt in the next five years. the oldest renewables and distribute it among the energy companies and the cut of the so-called benefits fallen from the sky of the nuclear and hydroelectric .

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