Electricity and natural gas suppliers, anticipating that customers may struggle to cover exorbitant energy bill costs amid the current energy crisis, are adapting to the conditions and appear prepared to offer personalized debt settlement options to customers despite facing cash-flow issues of their own.
Suppliers are preparing to offer customized monthly installment options to customers, based on their financial profiles, energypress understands.
According to electricity market officials, payment records by customers remain unaffected for the time being, despite the sharp increase in tariffs.
Energy suppliers have faced growing cash-flow pressure as a result of rising wholesale prices, to unprecedented levels.
The energy ministry has announced support packages for electricity suppliers, expected by the end of the year.
Electricity suppliers are set to receive a deposit amount totaling 165 million euros from the state’s Energy Transition Fund as compensation for their reduced revenues to result from subsidized electricity bills offered to consumers by the government for September and October as part of the overall effort to tackle the effects of the ongoing energy crisis.
Suppliers also stand to receive a 228 million-euro sum for electricity subsidies concerning November, while a 235.5 million euro-euro sum for December subsidies will be offered in 2022.
These sums will be divided up for electricity suppliers based on their market shares on August 31, 2021. Some corrections and revisions could be needed in 2022.
The subsidy plan announced by the government concerns a total of 7.6 million low-voltage household and business electricity connections.
Energy-intensive industrial producers strongly oppose an energy ministry plan to change the status of a RES-supporting ETMEAR surcharge included in electricity bills from a regulated to competitive fee by having it incorporated into the pricing policy of suppliers, EVIKEN (Association of Industrial Energy Consumers) sources have informed energypress.
The industrial producers have cited two key reasons for their disapproval. Firstly, changing the ETMEAR surcharge into a competitive component of supplier pricing policy would terminate the ability of industrial consumers to receive related compensation as, based on EU state aid directives, compensation is permitted for regulated charges but not competitive charges.
In addition, industrial consumers oppose an ETMEAR status change as a new energy exchange platform promises to offer strong incentive for new RES units to participate in competitive procedures to secure agreements with energy suppliers. This essentially means that fewer, if any, RES units will remain available for bilateral agreements with industrial producers, who are counting on such arrangements for an urgently needed reduction of energy costs in the medium term.
The resilience of manufacturers is already being seriously tested by recent energy price increases brought about by the energy crisis.
The energy ministry is working on a plan to change the status of a RES-supporting ETMEAR surcharge included in electricity bills from regulated to competitive by having it incorporated into the pricing policy of suppliers, the objective being to reduce the burden of this surcharge for consumers.
The initiative represents part of the ministry’s wider effort to restructure the RES special account, remunerating renewable energy producers.
The anticipated reduction of the ETMEAR level is expected to be offset by revenues that will be generated by green certificates to be auctioned off by DAPEEP, the RES market operator, a plan taking its cue from a formula adopted in a number of EU member states, including the Netherlands and Poland.
Green certificate revenues could reach as much as 600 million euros per year, energypress sources informed.
Under the new system, suppliers will need to purchase a minimum number of green certificates in proportion with their sales, securing a revenue source for the RES special account.
DAPEEP will no longer need to collect revenues from consumers, instead collecting from suppliers through the new mechanism.
A sharp rise in balancing market costs, which have reached 20 euros per MWh, comes as an additional headache for suppliers and the industrial sector, already facing exorbitant wholesale electricity costs amid the energy crisis.
Balancing costs have risen since the end of September, from 12.25 euros per MWh to 20.04 euros per MWh for the week covering October 11 to 17.
This upward trajectory further increases the cost of electricity for industrial consumers and non-vertically integrated suppliers at a time when market clearing prices have skyrocketed.
On Monday, when renewable energy dominated grid input with a 48 percent share of the country’s energy mix, the market clearing price eased to 189.30 euros per MWh before bouncing back up to 218.06 euros per MWh yesterday and 205.6 euros per MWh today. The average wholesale price for October is currently at 200.3 euros per MWh.
Should the balancing cost settle at the currently heightened level of approximately 20 euros per MWh, domestic industrial players will face even greater sustainability challenges, while retail electricity prices will rise further.
Suppliers and industrial enterprises are troubled as, under the current energy market conditions, there is no leeway for an increase in the balancing cost, which, even at previous lower levels of around 10 euros per MWh, was one of Europe’s highest.
Overdue payments owed by energy suppliers to the country’s market operators have been on the rise since summer, now exceeding 350 million euros, a development that has prompted the government to consider implementing an installment-based payment schedule as part of the solution.
The sharp increase in wholesale electricity prices over recent months has had a severe affect on the cash flow of suppliers, putting them under major financial pressure.
However, it should be pointed out that the majority of this 350 million-euro amount owed by suppliers to operators concerns the power utility PPC and includes a considerable amount owed from long before the current energy crisis.
Power grid operator IPTO, distribution network operator DEDDIE/HEDNO, and RES market operator DAPEEP are all owed sums by the country’s suppliers.
RAE, the Regulatory Authority for Energy, is now considering a three-part solution entailing: provision of letters of guarantee by suppliers to the operators, to prevent any further rise of the debt owed; immediate deposits covering 50 percent of amounts owed, either in cash or through bank guarantees representing equivalent amounts; and settlement of the remaining 50 percent through an installment-based schedule of between 8 to 12 payments, depending on respective agreements.
Energy suppliers have commended the government’s subsidy support package for electricity bills, stating the initiative is headed in the right direction, but, on the contrary, disapprove government intervention offering support to state-controlled gas supplier DEPA Commercial that will enable the company to absorb 15 percent of the natural gas cost increase.
This support offered to DEPA Commercial affects competition and the market’s overall functioning, rival gas suppliers protested. “DEPA Commercial may be a state-controlled company but this does not spare the firm from having to comply with free market and competition regulations,” a rival company official remarked. “The government’s move raises competition issues,” the official added.
As for the electricity bill subsidies, these will protect consumers from having to carry the entire burden of the surge in prices, while, on the other hand, suppliers will benefit from some cashflow relief as they will be requiring greater capital amounts at present and in the mid to long term, suppliers added.
The energy ministry is preparing a legislative revision for its recent antitrust agreement with the European Commission, requiring state-controlled power utility PPC to make available lignite-fired electricity packages to rival suppliers.
The antitrust agreement, already launched by PPC and designed to break its lignite monopoly, requires the utility to offer quarterly lignite-fired electricity packages from September 10, 2021 to December 31, 2024, if still needed.
Details in the plan forbid PPC to conduct back-to-back agreements with rival suppliers, or sale and repurchase of lignite quantities.
According to the plan, PPC, from the fourth quarter of 2021 until 3Q in 2022, must offer rival suppliers lignite-generated electricity quantities representing 50 percent of generation in the corresponding quarters a year earlier.
The upcoming legislative revision will spare PPC from needing to split away lignite divisions into two new companies for subsequent sale, as had been stipulated by legislation ratified by the country’s previous administration.
All existing lignite facilities in Greece are expected to have been withdrawn by the end of 2023, according to the country’s decarbonization plan.
The ongoing surge in wholesale electricity prices, now over 204 euros per MWh, a new record level, has astonished even the most seasoned company managers.
“The day-ahead market price surge to such levels has prompted great uncertainty as to what lies ahead,” one highly ranked official at a vertically integrated energy group told energypress
Responding to the wholesale market’s latest record-breaking level, an official at another energy group active in production and supply told energypress that suppliers are now recalculating their pricing policies from scratch.
Without a doubt, the electricity supply market has entered unchartered territory as the upward trajectory in prices, sparked by an unfavorable combination in international markets, appears to be unstoppable.
Company officials have admitted they have no choice but to pass on the majority of the price increase to their customers.
Some companies are cutting back on big discount offers extended to attract customers.
Electricity supply companies are facing severe cash-flow pressure as wholesale prices continue their surge and record-breaking streak, reaching 171.38 euros per MW at the energy exchange today.
Consequently, suppliers require greater capital amounts to purchase electricity quantities needed by their customers, not expected to pay for consumption until two months later.
According to market sources, the resulting extraordinary amount is currently costing electricity suppliers 60 euros per customer. Suppliers dread more wholesale electricity prices rises, which would further affect their ability to buy electricity before collecting related sums from customers at latter dates.
This cash-flow problem is greater for suppliers who are not vertically integrated and, as a result, have no other revenue sources. Even so, sector officials contend that vertically integrated players are also feeling the strain.
Suppliers are also on edge as a result of a lack of clarity on the government’s subsidy support plan for consumers, budgeted at 200 million euros.
RAE, the Regulatory Authority for Energy, is considering to facilitate a return to electricity suppliers, the RES special account and industrial consumers of amounts linked to increased balancing costs for a period until restrictive measures were imposed by the authority.
But, before taking any action, the authority has submitted an enquiry to the European Commission to ensure that such an initiative would not contravene EU electricity market regulations.
The response from Brussels is expected to offer RAE clarity as to whether it can move ahead with a reimbursement plan for affected groups for a period covering the launch of the target model just under a year ago to the ensuing restrictive measures imposed by RAE to counter increased balancing costs.
Electricity suppliers have questioned the sufficiency of a 150 million-euro amount to be made available by the government through a new Energy Transition Fund as support for households and businesses to combat increased energy costs.
The doubts were raised during an energy ministry meeting yesterday involving the country’s electricity suppliers, facing pricing-policy pressure – especially the non-vertically integrated – as a result of elevated wholesale electricity prices that have been driven considerably higher by a combination of factors in international markets.
According to Greek energy exchange data, the day-ahead market price average for today is 172.27 euros per MWh, while the day’s maximum price level in this wholesale market exceeds 200 euros per MWh.
The subsidy plan’s calculations are based on wholesale electricity prices ranging between 117 and 120 euros per MWh.
Energy markets throughout Europe are being severely impacted by the price surge. In the UK, for example, wholesale electricity prices have risen as high as 400 euros per MWh following colder weather and higher energy demand.
EVIKEN, the Association of Industrial Energy Consumers, has, in public consultation staged by RAE, the Regulatory Authority for Energy, backed the authority’s initiative for prospective revisions to retail electricity rules, noting competition is being affected by coordinated actions from suppliers.
In its letter submitted to the public consultation procedure, EVIKEN reminds that it has called for decisive intervention by RAE, noting that the supply market, in the absence of fundamental conditions fostering competition – a situation for which vertically integrated energy companies, especially private sector companies, are responsible – can be characterized by coordinated practices that aim to fully transfer to customers price risks entailed in day-ahead and balancing markets.
EVIKEN, in its letter, demanded data illustrating the number of days over the past two months when electricity production technologies (lignite, natural gas, hydropower and imports) determined prices in the day-ahead market.
RES special account revisions designed by the energy ministry to ensure new revenue sources and long-term remuneration protection for renewable energy producers will divide the account into two, an old and a new RES special account, made possible by 202 million euros in support stemming from the recovery fund.
A new and exclusive revenue source, the Dynamic Renewable Charge (DRC), will be exclusively channeled into the new RES special account. Revenues to be generated by this surcharge will be paid by electricity suppliers – in proportion to their market shares – to RES market operator DAPEEP and then passed on to their customers.
As for the old RES special account, existing revenue sources such as the ETMEAR surcharge included in electricity bills, as well as a green surcharge of 0.03 cents per liter imposed on auto diesel fuel, will be maintained.
In addition, the old RES special account will be offered protection through a formula balancing any fluctuations of the Public Service Compensation (YKO) surcharge included in electricity bills and the ETMEAR surcharge.
The new RES special account will include projects operating since January, 2021, while all previous RES units will continue being remunerated through the old RES special account.
The country’s electricity suppliers, across the board, appear to disagree with basic proposals forwarded by RAE, the Regulatory Authority for Energy, in public consultation concerning the reshaping of electricity bill clause rules.
Suppliers disagree with a RAE proposal calling for the elimination of a penalty clause linked to premature exits by customers from floating tariff agreements. The suppliers also object to the authority’s proposal for the cancellation of a fixed surcharge.
In addition, the suppliers question the effectiveness of upper and lower limits, as protective measures for consumers, in floating tariff agreements.
These objections are expected to be submitted by the suppliers to the public consultation process along with alternative measures.
RAE, the Regulatory Authority for Energy, appears set to adopt changes proposed by electricity market players for the authority’s package concerning new electricity bill pricing rules, including an appeal by suppliers urging the authority to avoid imposing a 30 percent limit on a clause enabling them to increase or decrease prices in accordance with wholesale price swings.
The authority’s proposal for this 30 percent limit, announced on July 16, prompted considerable reaction from electricity suppliers, who warned it would stifle competition, adding the Greek energy exchange does not possess tools that can offset wholesale-related cost.
Electricity suppliers have incorporated clauses into their electricity bills enabling price adjustments in accordance with wholesale price level increases or decreases.
The imposition of a 30 percent limit, up or down, would inflict even greater financial pain on smaller electricity suppliers, protesting market players warned.
RAE’s revised rules, seeking to offer consumers greater electricity-bill clarity and price-comparing ability, will be forwarded for a follow-up consultation procedure, possibly as early as this Friday. Otherwise, the procedure is seen commencing within August.
RES market operator DAPEEP has published a list of the energy mixes of energy suppliers for 2020, showing which companies are pursuing the most eco-friendly policies.
The operator, in publishing the list, noted that electricity suppliers are obligated to supply consumers with information on their energy sources for the previous year, in clear and comparable fashion, as well as information on the environmental impact of their choices, or CO2 emission levels concerning electricity generation they market.
A series of electricity bill-clause revisions proposed by RAE, the Regulatory Authority for Energy, seeking greater clarity and price-comparing ability for consumers, have already prompted negative reaction from suppliers, expected to lodge their complaints, in writing, to the authority by Thursday.
In recent months, suppliers have been forced to activate electricity bill clauses as they have battled to cope with the impact of sharply increased natural gas prices in international markets as well as higher carbon emission right costs, all of which has led to elevated costs for consumers.
The authority has proposed a 30 percent limit on clause-related increases and decreases; the termination of fixed costs, noting that, unlike tariffs, directly comparable, fixed costs tend to cause consumer confusion as they can run for one-month or four-month periods; the termination of an early-withdrawal clause, which would stimulate greater consumer mobility; as well as electricity supply price inspections every three months, the objective being to counter temporary below-cost offers extended by some suppliers to lure customers.
In comments to energypress, supplier representatives contended that RAE’s proposed measures would stifle competition and restrict the shaping of offers made to consumers.
RAE is seeking to standardize electricity-bill offers, which would eliminate any leeway available to suppliers for flexibility in their offers, especially when concerning fixed costs, some supplier representatives stressed.
RES investors, especially from the solar energy field, but also wind energy, are engaging in talks with electricity supply companies and industrial enterprises to establish power purchase agreements (PPAs) for their future or under-construction projects as they anticipate a reduction in capacities at forthcoming RES auctions and even lower tariff prices than the low levels registered at the most recent auction.
This increased focus on PPAs highlights the major shift taking place in green-energy production as fixed tariffs, at auction, are gradually being phased out and the energy-exchange era is taking over.
RES producers need to establish contracts for the sale of their output in order to develop their projects as banks are not willing to finance such investments if potential earnings, at sufficient levels, have not been secured in advance.
No bilateral PPAs have yet been established, but the negotiations are continual and tenacious.
Potential RES producers have – since the previous RES auction – been willing to accept lower prices, proposing levels of as low as 40 euros per MWh attached with demands for shorter contracts, including five-year periods, sources have informed.
Market officials expect PPAs to start emerging over the next six months, noting that banks will play a decisive role in the price levels to be established as their project financing decisions will depend on profit margins presented by investors.
A new target model formula calculating discrepancy cost is proving effective as, in most cases, it is impacting the finances of electricity producers and suppliers when they deviate from distribution orders and loading plans, power grid operator IPTO has noted.
As a result, the discrepancy cost formula should, for the time being, continue to apply for both electricity producers and suppliers as it appears to be offering a balancing incentive, the operator has recommended.
IPTO’s proposal has been forwarded to public consultation, taking place until May 7, for a scheduled reassessment of factors concerning non-compliance charges following the target model’s recent launch.
Electricity suppliers will have the right to prevent consumers from switching supplier if owing two or more overdue power bills without having registered for any installment-based payback plan, according to a proposal forwarded by RAE, the Regulatory Authority for Energy, following two rounds of public consultation on the matter.
Suppliers will have the right to submit power supply cut requests to the distribution network operator DEDDIE/HEDNO for consumers owing at least two months of overdue and unattended power bills, according to the RAE proposal, which has received the backing of all electricity suppliers.
A debt-flagging system to blacklist customers behind on at least two electricity bills will also be incorporated into the measure as a collective system accessible by all suppliers and the distribution network operator.
In the event that consumers with overdue electricity bills register for installment-based payback plans with their supplier, then move to a new supplier but stop servicing the payback program, the previous supplier will have the right to request power supply stoppages, even for pending amounts as little as 50 euros, sources informed.
RAE will now need to relay its proposal to the energy ministry for a ministerial decision enabling a revision of the country’s electricity supply code.
RAE, the Regulatory Authority for Energy, has adopted, to great degree, proposals made by electricity suppliers intended to restrict supplier switching by consumers seeking to prevent payment of electricity-bill debt.
Following a first round of public consultation, the authority staged a supplementary round, publishing its resulting proposals for an end to such consumer switching practices.
RAE has proposed the imposition of upper limits on electricity-bill amounts owed by consumers, which, if exceeded, would prevent them from switching suppliers.
For low-voltage category household consumers, the upper limit proposed by RAE is 150 euros per four-month billing period. For businesses, also in the low-voltage category, the authority has proposed an upper limit of 200 euros per four-month billing period. A 1,000-euro upper limit on electricity bill amounts owed per four months has been proposed for medium-voltage consumers.
Consumers whose unpaid power bills exceed these upper limits would either need to settle their energy debt or commit to installment-based payback programs in order to switch supplier.
RAE has also proposed a debt-flagging system that would be collectively used by suppliers to blacklist consumers behind on electricity bills. The authority proposes a rating system that would grade consumers seeking to switch suppliers as “red” if near or over the aforementioned upper limits or “green” if energy debt settlement agreements have been reached.
Power supply cut measures have also been proposed by RAE for consumers owing electricity bill amounts.
The authority has proposed that these measures be implemented for a one-year period before being reassessed.
RAE, the Regulatory Authority for Energy, has requested power grid operator IPTO to calculate the financial impact of balancing market distortion costs since November’s launch of new target model markets.
RAE has since decided to impose restrictions on balancing market offers. These are expected to be published in the government gazette today or tomorrow, enabling their implementation three days after the date of publication.
RAE estimates it will have implemented the balancing market restrictions by the end of this week.
It remains to be seen if RAE’s request towards IPTO for a measure of the higher balancing market costs incurred by suppliers will result in retroactive returns for affected parties dating back to the early-November launch of the target model.
Non-vertically integrated electricity suppliers, severely impacted by the increased balancing market costs that resulted in higher wholesale market prices, are demanding retroactive rebates.
Balancing market costs remained elevated last week despite the introduction of a first round of balancing market restrictions decided on by RAE, the Regulatory Authority for Energy.
The total balancing cost was 9.82 euros per MWh between January 25 and 31, slightly lower than the level of 10.82 euros per MWh registered between January 18 and 24, according to data provided by IPTO, the power grid operator.
Non-vertically integrated electricity suppliers, impacted by wholesale electricity price increases resulting from higher balancing costs since November’s launch of new target model markets, insist that decisions eventual taken by RAE for returns to suppliers of excessive balancing costs need to be retroactively enforced.
RAE has promised to examine this demand but the decision it could take remains unclear.
It should be pointed out that the recently appointed energy minister Kostas Skrekas generally does not favor retroactive enforcement of energy-sector decisions.
At least one non-vertically integrated supplier appears to have taken extrajudicial action against IPTO, overseeing the balancing market, making note of this market’s distortions and the operator’s responsibility.
Electricity suppliers have been unsettled by new RES-supporting ETMEAR surcharge conditions requiring them to apply new rates to medium-voltage customers retroactively, as of January 1, 2019.
There has been much mobility in the medium-voltage market as customers have often switched suppliers. The new retroactive requirement has caused confusion as medium-voltage customers may no longer be with the suppliers they were at in 2019, and, furthermore, being enterprises, they may even no longer exist. The obligations of suppliers remain unclear for such cases.
The ETMEAR surcharge framework has just been implemented after being postponed on a number of occasions.
A small number of enterprises will be required to pay smaller ETMEAR amounts, while most will need to pay higher amounts.
Certain industrial enterprises will be charged a reduced rate, 15 percent of the average ETMEAR figure, set at 17 euros per MWh.
The new ETMEAR surcharge for medium-voltage consumers belonging to other business categories, the overwhelming majority, including hotels, retail chains, banks, and low-intensity industries, is 17 euros per MWh, up from the previous rate of 9 euros per MWh. This increased rate will apply retroactively as of January 1, 2019.
Electricity suppliers are demanding a further reduction to a price ceiling proposed by RAE, the Regulatory Authority for Energy, for balancing market offers by gas-fueled producers, and, in addition, also want an upper limit of 3.5 euros per MWh imposed on compensation for this service.
This 3.5-euro compensation rate per MWh, which reaches approximately 5 euros per MWh when system-loss charges are added, is one of the highest in Europe, suppliers contend.
Suppliers also want electricity and balancing market cost limits to apply retroactively as of November 1, 2020 with returns of resulting amounts owed by the end of this accounting year.
Non-vertically integrated electricity suppliers have reacted strongly against sharply increased balancing market costs and far higher wholesale electricity prices since the launch of the target model’s new markets several weeks ago.
Three of the country’s non-vertically integrated electricity suppliers took part in public consultation staged by RAE, the Regulatory Authority for Energy, to present their objections and proposals, energypress sources informed. The procedure ended yesterday.
Energy minister Costis Hatzidakis’ recommendations to gas-fueled electricity producers for price restraint in the market have proven to be just partially effective, prompting RAE, the Regulatory Authority for Energy, to forward for public consultation restrictive measures, which, when legislated, will limit the levels of offers by producers in the balancing market.
Balancing market costs have risen sharply over the past six weeks, since the launch of target model markets, leading to elevated wholesale electricity prices that are now being passed on to the retail market, affecting consumers in the mid and low-voltage categories – households and businesses.
Sixth week target model market data made briefly available yesterday by power grid operator IPTO before being swiftly removed from the company website admittedly showed a de-escalation of price levels compared to unrealistically high levels reached in recent weeks, but, on average, these latest levels remained considerably high.
Taking this latest data into consideration, along with sharp price hikes recorded in the day-ahead market, the energy ministry is fully aware of the fact that electricity market prices could spin out of control if action is not taken.
The package of measures forwarded by RAE for public consultation is intended to restore market rationalization. It remains to be seen if these measures will prove effective.
Non vertically integrated electricity suppliers, hit hard by the increase in wholesale prices, are pushing for retroactive implementation of these upcoming restrictions.
RAE, the Regulatory Authority for Energy, will present for public consultation eight electricity supplier switching models used abroad following the rejection of a local version by the Council of State, Greece’s Supreme Administrative Court, and suppliers, energypress sources have informed.
This essentially means the entire process is beginning from scratch.
The models used abroad will be presented along with related proposals for comments and observations by electricity suppliers and any other interested parties, the objective being to reach consensus on a new set of supplier switching rules for the Greek retail electricity market.
Authorities will seek to shape a new model that will clamp down on serial electricity bill dodgers while also enabling free movement of punctual consumers from one supplier to another.
The previous model, adopted on September 1, was rejected late last month after being deemed faulty. It was marred by major obstacles, discouraging consumers to seek optimal solutions.
Contrary to the satisfaction being expressed by natural gas-fueled electricity producers over the target model’s new markets launched three weeks ago, electricity suppliers, especially those not vertically integrated, find themselves having to pay considerably higher prices for their electricity purchases, which has raised sustainability concerns and could also lead to higher electricity costs for consumers.
Balancing market prices have more than quadrupled, reaching levels of as high as 15 euros per MWh, compared to approximately 3 euros per MWh in the market system used prior to the launch of the target model markets.
This drastic increase has raised concerns among suppliers, who fear the higher cost will eventually need to be rolled out to consumers.
The balancing market’s additional cost for suppliers totaled 27 million euros in the first fortnight of November.
The effort to balance the system is costing consumers millions more, overall, suppliers have warned, noting that, contrary to other European markets, initiatives taken to further liberalize the electricity market are raising rather than lowering price levels for consumers in Greece.
RAE, the Regulatory Authority for Energy, is closely monitoring the situation. The authority believes it is still too early to reach any safe conclusions on the balancing market. If, however, the current situation stabilizes into a permanent condition, RAE will intervene with corrective action, it has informed.
Any nervousness felt by producers over the target model’s new markets ahead of their November 1 launch are swiftly being quelled by rational trading results. On the contrary, non-vertically integrated suppliers have experienced cost increases and, as a result, are concerned about their company prospects.
Although it still too early to tell, electricity producers believe day-ahead market prices are reflecting actual conditions, rising with shortages and falling with any oversupply.
Day-ahead market prices began at 60.44 euros per MWh on November 11, fell as low as 41.11 euros per MWh on Saturday and rose to 68.36 euros per MWh for today.
These price levels for the day-ahead market, known as the System Marginal Price under the previous system, are regarded as being at rational levels.
Producers have also expressed satisfaction over the balancing market, a largely unknown entity prior to the target model’s launch. Prices have been high, enabling units with flexibility to ensure solid earnings.
Day-ahead market prices are projected to fall, which would subsequently limit electricity imports and require domestic power stations to operate for longer hours.
Higher earnings for producers mean greater costs for suppliers. Non-integrated suppliers are concerned about their prospects under such conditions.