Teresa Ribera, Spain's Minister for Ecological Transition. / efe

Spain to apply for cap on gas price to be extended until end of 2024

The government hopes to maintain prices around 45 or 50 euros per megawatt hour because reform of the electricity system in Europe could take a long time

JOSÉ MARÍA CAMARERO Madrid

There are still five months before the cap on gas prices in Spain and Portugal (known as the Iberian Exception) is due to come to an end, but the government plans to ask Brussels for an extension until the end of next year.

Minister for Ecological Transition Teresa Ribera has said this Monday morning that the plan is to continue with the current price cap of between 45 and 50 euros per megawatt hour.

The price cap came into force in 15 June; it is a mechanism which limits the price of gas used to generate electricity, in order to keep electricity prices down. During the first six months the gas price was capped at 40 euros/MWh and will now rise by five euros/MWh until May, when the measure is due to end.

Ribera said it could still take a long time for the electricity market in Europe to be regulated, and Spain wants to continue benefiting from the exceptional measure.

Till the end of the energy crisis

“We are going to present proposals to modernise the electricity system to the Commission, and we will also apply for the gas price cap to continue. We would like it to last throughout the crisis, and that could mean until at least the end of 2024,” she said.

The price of electricity depends greatly on how much gas is needed to produce it, so when renewable energies are used the prices fall, but when more gas is required they increase.

Spain is calling for the European electricity system to be modified to make prices less volatile and reduce them. Ribera said measures already in force and plans to modernise the European system should contribute to stabilising prices this year.