Spain and Portugal team up to propose cap on electricity costs

SPAIN and Portugal are to submit a proposal to the EU to cap wholesale electricity prices

The plan was confirmed by Minister for Ecological Transition, Teresa Ribera who said the two nations are requesting a €180 per megawatt hour limit on wholesale prices.

A similar cap on electricity prices was in place prior to 2019 before an EU directive which banned caps was brought in.

If the request was to be approved it would limit skyrocketing electricity bills in Spain, with wholesale prices averaging  €217 this week.

There are concerns that the war in Ukraine will further increase the cost of electricity.

However, at present, EU leaders are not agreed on how best to protect their citizens from soaring costs.

Ribera said: “If only two years ago we thought it was crazy for the price to rise to €180 and now it is far higher than that, there is no argument against that being the maximum rate that we should accept in our market. The situation in the energy market in Spain is intolerable for the industry and for households. However, the government will wait for the European Commission’s response before taking any new measures.

Portugal’s Environment Minister Joao Matos said the proposal would be submitted on Friday.

“With the new joint proposal, Spain and Portugal wish to reinstate the limit of €180 which market they were forced to eliminate in 2019 when the EU decided to remove curbs on energy prices across Europe,” he said.

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