Spain hasn’t used that much gas for almost 15 years: the key to the energy crisis

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Combined cycle plants contributed 43.4% of the power system’s output on Thursday

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Soto de Ribera Combined Bicycle Power Plant.Aloy Alonsoefe

After reaching 177.90 euro per megawatt hour in the wholesale market, electricity prices will increase once again this Friday. The increase, up 4.15% compared to the figure set on Thursday, continues as the cap was implemented on the price of gas for power generation, which goes hand in hand with fuel. In any case, there will be little relief, as compensation to combined cycle plants hardly varies despite the fact that on Thursday they contributed 43.4% of the generation to the power system.

The percentage is the highest seen in the last 15 years. In fact, since June 2008, combined cycle production was just over 40% on one occasion: two days earlier. Despite the fact that Spain, in principle, is not so dependent on it, gas is still the hero.

Power Generation

What is the reason for the current crisis?
For several factors, actually. And all of them could have had an effect on the price of electricity individually, so their combination has caused the price of everything to rise into a kind of negative electricity synergy.
The first, of course, is the price of gas, which continues to rise. The price of 80 euros per MW on the first day of the fixed cap for electricity generation has risen to 106.94 EUR per MW this Friday. It should also be taken into account that the heat of a heat wave has a high energy demand for cooling and, in addition, some of it comes at times that are generally cool, such as at night. As if this was not enough, then it is not possible to resort to solar. Australia, which is still heavily dependent on coal, has asked citizens of the state of New South Wales to turn off the lights for two hours a day to save energy.
Returning to Spain, wind power, the third stage of this volatile table of factors, spent three days with the generation contributing 10% (9.9%, 9.8% and 10.2% between 14 and 16 June), when sometime earlier It became the dominant technology with a quarter of the work load.
Does war affect?
Yes, in a way. Russia doesn’t get to cut off the gas tap, but neither does it allow it to flow with all its might. In fact, Gazprom reduced production through the Nord Stream by about 60% in a matter of days: from 167 million cubic meters of gas to 67. He alleged technical problems due to the restrictions not having required materials, something that had not been reported in Germany. They believe. Anyway, reducing the offer adds up to the cost.
How is the price calculated?
In reverse auction. Every day, the agencies in charge of energy management in each country go to the wholesale market, where manufacturers offer the electricity they have on a cost basis to produce. Renewables, therefore, come practically free, with the peculiarity that they are all subsequently sold for the same price: that of the most expensive energy. The system is complex, but it has been established in principle to benefit green sources and promote their growth. However, not enough cheap energy is currently being produced to meet everyone’s needs, and more expensive or polluting sources, such as gas, have to be used.
Why is gas important?
Also because it covers the shortcomings of the system, only combined cycle plants and hydroelectric plants can be quickly commissioned when demand peaks. Solar and wind depend on their sources—the sun and wind—and coal and nuclear are not instant, but take between hours and days to generate electricity.

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