The regulated electricity tariff sieve, which the government is preparing, intends to force tens of thousands of companies to pay the voluntary price of small consumers (PVPC), the regulated electricity tariff, but also to force hundreds of municipalities and communities. Authorities should abandon this tariff modality and formalize their supply in the free market.
The change will not be immediate and must be implemented from 2024, so affected entities will have time to adapt. Supply covered by PVPC, about 10 million contracts, is mostly households, but there are still many companies. And industry sources estimate that between 10% and 20% of all major trading companies’ supply points to state administrations are still in the regulated market.
“On the part of the central and regional administrations, there is practically no supply in the PVPC. However, in the case of (smaller) local administrations, it really is,” these sources explained. a lot Talking about “hundreds” of affected municipalities is “not an exaggeration”.
In the draft decree that the Ministry of Ecological Transition received a consultation of 2 million euros) and, an important detail, natural persons. However, public bodies that are still in the PVPC are left out.
The public consultation text, which is open for comments until next Monday, states that “owners of supply points, which are individuals or micro-enterprises, which supply a voltage of no more than 1 kW and less than or equal to 10 kW. The mentioned capacity limit of each existing hourly period can be changed by order of the Minister of Ecological Transition and Demographic Challenge, with the prior agreement of the Commission of the Governmental Delegation of Economic Affairs.
Currently, the only limitation to using PVPC is that these supplies have a maximum capacity of 10 kilowatts (kW). The vast majority correspond to houses. But among them there are companies, including small and medium-sized businesses and, as they say, in the sector, some large companies and public institutions.
The government has not specified the number of contracts that will remain after the reform takes effect. In this case, it will be in early 2024. The new pricing formula should be implemented in early 2023, as confirmed by the third vice president in Congress last Wednesday. In this case, it is planned to give more weight to the futures markets in the formation of PVPC. This rate reform was an EU demand in exchange for the Iberian exemption powers.
Sources at the Spanish Federation of Municipalities and Provinces (FEMP) indicate that they do not have information from local entities in the regulated market “because from here, through our contract factory, the existing framework agreement is on the free market”. Neither the National Markets and Competition Commission (CNMC) nor the Ecological Transition are said to have information on the volume of public administration contracts at PVPC.
This tariff modality is considered in the contracts obtained from the framework agreement with Iberdrola, managed by the Provincial Council of Alicante, as well as in the supply contracts recently signed by public companies such as Giahsa, from Huelva, or in which the Seville City Council awarded electricity. Delivery of traffic lights in the capital city of Seville in 2020, when PVPC was the cheapest option, and for a period of four years (until 2024).
They are also in the position of former public clients of marketers who stopped supplying them with the virus of the current energy crisis. This is what happened to the Port of Gijon or to many former clients of Marketing Aura, who served hundreds of public bodies and that a year ago it began unilaterally terminating contracts given that wholesale market prices began to get out of control. .
Some of these public clients have had to enter into emergency contracts with PVPC’s marketers of last resort associated with distributors operating in their areas following the termination of Aura’s contracts. This is the City Council of Pozuelo de Alarcon (Madrid) or the Health Service of Castilla-La Mancha.
These restrictions in the PVPC stem from the European directive, 2019/944, which forces the liberalization of the electricity market, allowing only “public intervention in the determination of the price of electricity supply to domestic consumers and micro-enterprises”, recalled the executive public consultation regulations. .
The government recalls that until 2021 “the PVPC rate offered more competitive prices to end users in the free market against fixed pricing systems”, according to a consistent analysis by the CNMC, although since then the cost of energy has been set at the wholesale market hourly price. However, PVPC regained traction after the gap was introduced.
The reform of PVPC is part of the deep changes that the executive is preparing in the electricity tariff. The most imminent change was introduced in October, in the decree, which provides for the receipt to include in the future the average residential consumption of the customer’s neighborhoods, allowing them to compare it with their neighbors.
The new regulations also regulate information on fiscal incentives that currently apply to VAT or electricity bills, and from December it will be forced to report transparently how the Iberian mechanism is used, including objective information on its cost and impact on wholesale trade. on the market so that consumers know their benefits: the government estimates about €3,000 million in savings since its launch in mid-June.
Source: El Diario