3 ms·

Somewhat simplistically, the actual price at a given time is guided by the cost of the marginal source, i.e., the one source that is brought in to meet higher d

Somewhat simplistically, the actual price at a given time is guided by the cost of the marginal source, i.e., the one source that is brought in to meet higher demand. If gas is your marginal source, then the electricity price is in large part determined by the wholesale cost of gas (at the price it was bought at, so there's a lag to the current cost). Europe as a whole has been over reliant on gas from Russia, and the cost of gas has gone up very sharply and Europe doesn't have that much of it domestically.

hibikir 3y ago
This isn't applicable to Spain however, thanks to what is known as the Iberian Exception. Since gas for Spain and Portugal comes from northern Africa, and in practice is priced differently. You will see that Spain's energy prices are often far lower than in, say, France. So I wonder about the grandparent's claims here. I see that the average price per kwh in Spain is about 13 cents right now, which is basically the same price that I see in Missouri, one of the US' cheapest states for electricity. So unless I am missing something, it's a pretty similar situation.
- otherme123 3y ago
  In Spain (not sure in other countries) there's a bid every day for the prices the next day. Solar, eolic and nuclear bid at zero (they sell all they produce), then it comes hydro, and after that gas. At some hours of the day prices are low: tomorrow we will pay 8 cents in the central hours, probably the hydro will set the price, and 20 cents at 20:00, when gas will be needed. More than 80% of the electricity will be zero CO2. If you program your heavy consume, you can average less than 10 cents. The iberian exception, that is limiting the gas price, isn't needed since the beginning on 2023, because the market gas price is below what triggers the limiting.

3 ms·

Somewhat simplistically, the actual price at a given time is guided by the cost of the marginal source, i.e., the one source that is brought in to meet higher d

by awjlogan 3y ago

hibikir 3y ago
This isn't applicable to Spain however, thanks to what is known as the Iberian Exception. Since gas for Spain and Portugal comes from northern Africa, and in practice is priced differently. You will see that Spain's energy prices are often far lower than in, say, France. So I wonder about the grandparent's claims here. I see that the average price per kwh in Spain is about 13 cents right now, which is basically the same price that I see in Missouri, one of the US' cheapest states for electricity. So unless I am missing something, it's a pretty similar situation.
- otherme123 3y ago
  In Spain (not sure in other countries) there's a bid every day for the prices the next day. Solar, eolic and nuclear bid at zero (they sell all they produce), then it comes hydro, and after that gas. At some hours of the day prices are low: tomorrow we will pay 8 cents in the central hours, probably the hydro will set the price, and 20 cents at 20:00, when gas will be needed. More than 80% of the electricity will be zero CO2. If you program your heavy consume, you can average less than 10 cents. The iberian exception, that is limiting the gas price, isn't needed since the beginning on 2023, because the market gas price is below what triggers the limiting.