NOME starting price set for big hike, new setback for suppliers

The NOME auction starting price, revised every June by RAE, the Regulatory Authority for Energy, and shaped by a number of key factors, appears set to rise sharply to a level of at least 55 euros per MWh//h from the 36.34 euro per MWh/h set last June, according to pundit calculations.

The revised NOME starting price is expected to apply for the year’s third and fourth sessions scheduled for July 17 (500 MWh/h) and October 16 (767 MWh/h).

This would come as a major setback for the country’s independent electricity  suppliers, already facing uncompetitive electricity market conditions in their effort to gain market shares at the cost of the main power utility PPC, still dominating.

Higher NOME auction prices reached at the previous two NOME auctions have severely restricted the ability of independent power suppliers to compete seriously against PPC.

PPC’s tariffs have remained unchanged despite a rise in wholesale prices. The power utility wants to increase its tariffs by introducing a clause enabling hikes if certain CO2 cost upper limits are exceeded and reducing a 15 percent punctuality discount. It remains unknown if and when the government will permit these moves.

The NOME starting price is reset every June following a joint ministerial decision by the energy and finance ministries, based on the results of a RAE study on the matter.

The forward price for CO2 emission rights at the European Energy Exchange and PPC’s cost-related data concerning variable costs are the two main factors taken into account by the energy authority when reviewing the NOME starting price.