Spain now has the most expensive electricity in Europe. The labor income-sucking mechanism called Green Deal is now running at full speed… and with a bonus: Spanish imperialism is recouping its European failures through the electric power bill
Table of Contents
- Despite the promises, the electricity bill is rising
- The mechanisms of the Green Deal and electricity prices
- The most expensive bill in Europe
- Key ideas
Despite the promises, the electricity bill is rising
The new time-slot system was repeatedly touted as lowering prices. Analyzing the available data at the time, we pointed out that it would actually go up by 10-20%. We were wrong by a long shot. The government itself has had to acknowledge that it will exceed 45% and in reality, according to data from consumer organizations the actual price per KW/h has risen by 74% making it the most expensive power bill in Europe.
Now they are considering a suspension during 6 months of certain taxes to mitigate the disaster. But according to the data provided by the minister it would only reduce the hit by 4%.
The mechanisms of the Green Deal and electricity prices
As we anticipated, the price of oil and gas is going up, but above all the cost of a ton of CO2 emitted in the speculative emissions market created by the EU keeps going up… it has already doubled since November. And if today it passes 51 euros, the speculators’ bet is that it will reach 60 before the end of the summer. Between one thing and another, they more than compensate for the last-minute cut to nuclear and hydroelectric profits.
Under the terms of the Green Deal, it only takes a few days of weak wind for gas – and its CO2 emission allowances – to take on more weight in the basket of energy sources and for prices to escalate.
But the whole of Europe is already living under the Green Deal. To explain why Spain pays the most expensive bill in Europe, there is a fundamental element that is hardly mentioned: the inter-European imperialist game.
The most expensive bill in Europe
Theoretically, the way to dampen the ups and downs of wind power is… grid scale. Germany has just launched its interconnection with Norwegian offshore wind farms. And the EU has created a whole network of European interconnections which it wants to prepare to ensure cheap power supply… for Germany, which in the end regularly draws on French nuclear, a cheap source of power with the current pricing system… and a constant one.
But if we look at the map something is irremediably striking: the Iberian peninsula is missing. This is not Germany’s fault. The German ministry sees it as a strategic solution to invest in solar energy in Spain and Portugal en masse, thus offsetting emissions from its own industry and receiving cheap electricity through the French grid.
Given the volume being considered, it would allow Spain to increase the amount of renewables in its basket on a scale likely to significantly dampen the bill.
But… this would erode the profitability boom that the power companies are receiving, which would take longer to recoup their investments by having to share the domestic market… although in the medium term they would make up for it with solar exports. That is to say, neither the Spanish electric utilities nor the capital sheltered in them are thrilled.
On the other hand, it would also lower French export prices. And, as the French government sees it today, even if France were to export electricity to Spain, German investment and demand diverted to the Iberian peninsula would not be worth it for business in the medium to long term. The longer it takes for the investment plan to be implemented, the better for French capital.
So France closes its electricity border just as before it closed its gas border much to the frustration of Repsol and Enagas. And by not being able to access the French grid in order to buy nuclear-sourced electricity in the face of sun and wind downturns, bills in Spain and Portugal do not find the mitigating factor found in the rest of Europe.
- What drives electricity prices up is the Green Deal. The electricity bill is a key tool for transferring income from labor to capital, and that is its goal.
- But the Green Deal is in place all over Europe. What makes the electricity bill in Spain and Portugal the most expensive in Europe is the absence of electricity interconnection.
- It has not been connected because Spanish imperialism has been unable to force French imperialism into connecting Spain and Portugal to the European electricity market for the last decade.
- It is now strategic for France to delay it as long as possible because it would make masses of German capital go to the Iberian peninsula instead of France and in the medium term the benefits of its electricity exports to Germany would be lower.
- If markets were connected now the Spanish business would not be immediate: Spanish electricity companies would go through a period during which French prices would reduce the current wild prices of KW/h in relation to the European one. Although in a couple of years that would be compensated by sales to the European market of cheap solar and wind energy, now they are not in any hurry either, that’s why they don’t push the government.
- The result is that between the weakness of Spanish imperialism unable to impose itself on the French blocking capacity and the short-sightedness of the industry which favors the overpricing of today over the bigger business of tomorrow (another sign of weakness of Spanish capital)… the electricity bill of Spanish and Portuguese workers pay is not only multiplied by the Green Deal but has a plus, that of imperialist failure, which makes it the most expensive in Europe.