Spain: European Union Rejects its Request to Change Mechanism of Power Pricing

On Thursday, 12^th August 2021, Teresa Ribera, environment and energy minister of Spain said, the European Commission has rejected a request of Spain for changing the rules, that had been underpinning the electricity markets of the European Union Member States as the prices of power in Spain have been hitting the record high.

Increase in the demand for the natural gas along with the continuously increasing cost of the permits of European Union for emitting carbon dioxide have been responsible in pushing up the prices of the electricity in several countries and it has also sparked a political blame game in the country.

Teresa Ribera said, she had been telling the energy commissioner of Europe in July 2021 that, the rules of the European Union meant that the cheap renewable energy had been sold for the same prices as the costliest power based on the fossil fuels, that is mainly responsible for forcing the prices even more high and it should be reviewed.

On Thursday, 12^th August 2021, the environment and energy minister of Spain also said, the European Commission has replied that, it is having not intention for introducing the changes in the marginal system since it has been the most simple, efficient and easy.

Most energy markets in the continent of Europe have been relying in the marginal costs for the purpose of setting the prices, which means the overall prices has been set by the cost for bringing the upcoming unit of the power to the energy market in Spain.