During these months, the price of natural gas and CO2 is escalating, which has a direct impact on the cost of electricity in much of Europe. This increase affects both large companies and families and small businesses., who see their energy costs increase in anticipation of the upcoming winter.
European electricity markets operate under a logic in which the final price of electricity It is determined by the most expensive technology needed to meet demand. In many cases, this technology is generated with gas natural. Added to this situation is the cost of the CO2 emission rights, which requires polluting power plants to purchase permits for each ton of carbon released into the atmosphere.
Marginalist electricity market and the role of CO2
The marginalist system, in which The price is set by the latest technology that comes in to meet demand, usually leaves the price formation in the hands of gas plants, especially when renewable or nuclear generation is not sufficient. The rising cost of gas drags with it the rise in the wholesale price of electricity, and the cost of CO2 emission rights This implies an additional cost for gas and coal plants, which have to pay for the carbon released during production.
In recent years, the The European Union has tightened regulations on emissions to accelerate the energy transition. This has led to a significant increase in the price of CO2 in the markets, which will remain above €2025-40 per tonne in 50 and with prospects of continuing to rise according to the decarbonisation targets for 2030.
The expansion of the ETS2 system and its domestic impact
This year, the EU has made progress with the launch of the new Emissions Trading System (ETS2), which will change the energy bill of millions of consumers. Sectors such as road transport and building heating will gradually enter the system, which will cause The price of CO2 has an immediate impact on the costs of petrol, diesel and domestic gas.
In practice, fuel suppliers will have to acquire rights for each tonne of CO2 generated, and this will be reflected in the final price of fuels and heatingAccording to calculations by the European Commission, a base price of 48 euros per tonne could generate Increases of up to 0,11 euros per liter for gasoline and 0,13 euros for diesel, in addition to making gas heating more expensive by several euros per megawatt hour.
Risks, doubts and challenges: European electricity facing change
The current outlook presents some uncertainty. Some countries have requested to delay the entry into force of ETS2 arguing social and economic difficulties, while the European Commission insists on meeting decarbonization deadlines. In addition, a market stability reserve to avoid waves of speculation and price spikes, although its effectiveness remains to be determined.
On the other hand, international precedents reflect the complexity of the process: in Canada, carbon pricing generated political controversy by underestimating its social impact, despite compensation measures. In Europe, governments must balancing climate demands with social protection so that the transition does not leave behind those who depend on conventional fuels.
El price of electricity in Europe The energy market will continue to be influenced by the evolution of gas and CO2 prices, in an environment where decarbonization is a priority, but security of supply and cost for consumers and businesses remain topics of debate. Transition policies and social compensation mechanisms will be essential for this new energy model to be beneficial and sustainable.