“So that our citizens have lower heating bills,” Sánchez said in an interview on the Cadena SER radio station, justifying his government’s decision to reduce the VAT on gas as well. According to him, the government is trying to “fairly distribute the costs of the war” in Ukraine.
Energy prices started to rise more noticeably last year, gas for the European market was sold at around 28 euros per megawatt hour (MWh) in the virtual trading hub Title Transfer Facility (TTF) in the Netherlands, while now it is around 230 euros/MWh.
But already before Christmas last year, its price increased sharply and reached 130 euros, before returning to below 65 euros in January. According to some analysts, it was a reaction to the energy policy of the European Union, which is pushing for a rapid shift away from fossil fuels without an adequate solution.
Spain will propose that the entire EU take over the gas cap for electricity production
The situation on the energy markets worsened after the invasion of Ukraine by Russian troops in February, so at the beginning of March the price of gas in the TTF temporarily reached 345 euros per MWh, but on the same day it returned to below 200 euros/MWh.
The price of gas in the TTF is decisive for raw material prices in Europe, while Russia is an important supplier of gas to the European Union.
Consumption has increased compared to last year
Spain and other EU member states have agreed to reduce gas consumption by seven percent. However, gas consumption in Spain is still higher this year compared to last year, Reuters reported.
The heat waves caused the demand for electricity to increase several times due to the higher use of air conditioning, but at the same time the water levels decreased due to the heat, so the result was lower production of hydroelectric plants.
They are an important source of electricity production in Spain.
The energy market in Europe is frozen and we need to fix it, Síkela said
Czech Industry Minister Jozef Síkela said on Wednesday that he will propose to the government to increase this year’s assistance to households with energy prices. He wants to focus mainly on vulnerable customers, but he has not yet presented the details of the proposal.