Electricity in Spain and Portugal is traded at 1 euro MWh. In Romania it is 69 euros MWh

In January of this year, as a result of the drop in energy prices traded on the spot exchange, we drew attention to the artificial maintenance of the capping of delivery prices to final consumers, a dubious business run by the Romanian state, so that the suppliers would collect the difference from the state budget .

At the same time, the same government, through the Ministry of Energy, circulated “the possibility that prosumers will be penalized due to overproduction, after they had been stimulated to install photovoltaic panels and provide surplus energy, which they did not consume for their own needs.

Normally, production in surplus in production automatically attracts the decrease in price. In Romania, it was not possible to drop prices and abandon a ceiling that was no longer necessary, but which generates fabulous holes in the state budget month after month. The lower the real price on the exchange, the greater the difference the state pays to suppliers until the artificially maintained ceiling is reached.

The hallucinatory explanation for the fact that the cap was not waived was given by the Minister of Energy and can be read in the article If the price of energy fell on the stock market by 67%, why is the ceiling not abandoned? The delusional reason invoked by the Ministry of Energy

What we cannot do because we don’t want to, has become a reality for others – Spain and Portugal are registering price drops per MWh on the free market, today energy is traded on the spot market at 1 euro MWh.

According to hotnews.ro, the cheapest electricity in Europe is sold on the spot markets in Spain and Portugal. For over a month and a half, prices have fallen so much that, days in a row, energy is traded at extremely low values, reaching an average level of just 1 euro on Wednesday.

This tendency to keep prices at extreme levels is influenced by large productions of renewable energy, especially photovoltaics.

Analyzing the evolution of prices on the European markets, from the last month, we can see that electricity in France is also starting to be traded at lower and lower levels, up to 20 euros / MWh less than the levels on other markets.

The more green energy increases, the lower the prices

Electricity prices in Spain have fallen to near zero as wind and solar farms produce more power than ever in the Mediterranean area, Bloomberg reported nearly a month ago.

While the sharp drop in prices is good for consumers as it will be reflected in household bills, lower long-term levels risk hurting investment in renewable capacity as Europe is in full transition to a green economy.

Returning to Romania, even if at the moment our country does not have the green energy production capacity like Spain or Portugal, our authorities have recognized that prosumers are delivering more and more to the network, which should normally attract new price drops. It won’t happen too soon, the Ministry of Energy being more concerned with protecting the “actors” on the niche market, ensuring their long-term predictability for unreasonably high receipts, especially from public funds.

The energy price ceiling scheme cost us 15 billion lei last year, that is, 3 billion euros from the state budget.

We remind you that, in the midst of the energy crisis, on the spot markets, one MWh of electricity reached record levels of over 550 – 600 euros/MWh.