The Iberian intervention “endangers the electricity market” – Efet

“It is already having a detrimental effect on the Iberian electricity futures market and its potential to disconnect the Iberian electricity market from the rest of Europe sends a dangerous signal in terms of the fragmentation of the internal energy market. “, added the trade body in a press release.

“Details of the deal have not yet been released, seven days after this announcement,” Efet said, responding to Lisbon and Madrid. to agree with the EC to set a limit of 50 EUR/MWh over 12 months on gas prices for electricity production in order to curb soaring energy bills.

Efet has urged Spain and Portugal to “change their course” towards targeted aid to vulnerable consumers.

Liquidity impairment
The announcement had already damaged liquidity in the Iberian futures market, Efet said.

“The constant risk of further regulatory intervention in the Iberian Peninsula is destroying market confidence.”

The new cap penalized consumers who purchased their supply in advance, turning coverage into a disadvantage and deterring “prudent risk management behavior in the future”.

“Separating Iberian electricity prices from market fundamentals also risks distorting transactions and cross-border flows in the day-ahead market and isolates the Iberian Peninsula in intraday and balancing,” Efet said.

He also warned of other “unintended effects” of the measure, including increased use of gas-fired power stations, which in turn could threaten decarbonization efforts.

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