Neither Plan B nor Plan C: the main objective of the President of the Government,

Pedro Sánchez,

in the

European Council

that started yesterday in Brussels is to obtain the permission of the European institutions and partners to achieve an ad hoc energy regime, a "particular response for the specific problem

the energy island of the Iberian Peninsula". This was explained upon his arrival at the meeting, in which the heads of state and government of the 27 will talk about the Ukrainian war, the economy and especially energy throughout Friday. The president has not expressly spoken of acting alone if the solutions are not satisfactory, but the sensations transmitted to his interlocutors in the last week is that the unthinkable and unacceptable thing would be not to do everything possible.

Spain's plan involves limiting a maximum price for natural gas power plants.

These installations are passing on the skyrocketing price of this hydrocarbon when they use it to generate electricity, and this cost ends up being extended to the whole of the energy generated by the rest of the sources, as it is a marginal market in which all suppliers charge the price of the highest offer that manages to match the demand.

Sánchez wants these plants to offer at a lower price and then compensate them outside the market if they show that the gas they use was bought at a price higher than the legal limit that Spain wants to apply.

This compensation would be charged to the General State Budget (PGE) or to the gas bill of all Spanish consumers.

However, this idea would imply in its fine print a thorough review of the rules of the game in electricity interconnections with France to avoid distortions in the European electricity market.

All of them are collected in a technical document managed by the

Ministry of Ecological Transition

to which EL MUNDO has had access.

In this paper, which the Spanish delegation will show to its European colleagues today, it is stated that subsidizing the price of gas in Spain would force "technical adjustments" to be made if France did not avail itself of this system, since then a large gap in prices between the two countries and exports of Spanish electricity would skyrocket.

Among the proposed solutions are the establishment of a price different from the market price for the interconnection itself, limiting the capacity of the electricity transmitted and, in the most extreme case, suspending exports when "significant price differences" or a distortion of the price are observed. market for the Spanish subsidy.

Among these distortions, he cites the case, for example, of a Spanish electricity company being tempted to produce the maximum amount of electricity possible to sell it in France, charging the Spanish compensation.

The measure seeks to avoid a resounding rejection of France and even opens up the possibility that only exports are prohibited, but not imports of electricity originating in the neighboring country.

In addition, it opens the door to "compensation" -without detailing how- for having to close the electrical border.

Despite these limitations, sources from the energy sector consulted believe that the idea will not pass the filter of the European partners and would not have the support of France, since this country needs to buy Spanish electricity at the moment due to the failure of several plants nuclear.

"There is a specific reality of the Iberian Peninsula. You have heard me talk a lot about interconnection problems. The peninsula is an energy island, there is barely 2.8% of interconnections between our market and the European market, and we have very specific characteristics that they harm us and that are aggravated by the rise in the price of gas," the president said yesterday.

"Therefore, the governments of Spain and Portugal have proposed a technically rigorous, solid proposal that does not call into question the functioning of the market and that could give us both the capacity to respond decisively to the rise in gas prices. and electricity," he added.

The EU has been discussing energy since late summer.

The Spanish Executive has been the most insistent since then on "very bold measures".

Then their proposals and requests were ignored and blocked, but now, after the Ukrainian invasion and with skyrocketing prices, the reality is very different.


European Commission

This week he presented his third battery of ideas, and already contemplates what was once unimaginable: price caps (temporarily), joint purchases of gas, compensating or subsidizing producers for the inflation of raw materials.

In addition to taxing the so-called "extraordinary profits", among other things.

However, the two ideas that are most interesting in Madrid are not there: completely disassociating the price of gas from that of electricity and completely intervening in the market to change the marginal price-setting system.

Not now.

The Commission has put a series of proposals on the table, but without enthusiasm, as it warns that many of them, although they fulfill their purpose in the short term, may have counterproductive effects in the medium term.

And even to guarantee supply at a more than delicate geopolitical moment.

Spain is very satisfied, because "many of these ideas are copyrighted by Spain," according to the president.

But aspire to more.

And if there is no intervention at a general level, what Moncloa is asking for is

permission to go it alone

, guaranteeing that the connection between our market and the European market is so weak that nothing could be endangered.

"Now a formula is important that is adapted to the reality of the Peninsula, which is an energy island that has less than 3% of interconnections with the north. We are poorly integrated, but all the rules of the market apply to Spain and this It is something that harms us doubly. Because of the scarcity, the insignificance of the interconnections. We have both proposed something very reasonable, technically sound, that does not call into question the functioning of the market, hopefully we will find the levers so that this can become a reality", the president has said.

Until now it seemed that the president proposed this treatment ad hoc in case of not achieving a global solution.

In fact, he reiterated that although on the 29th the Government will present a national plan to "respond to the consequences of the war and give a concrete and global response to the problem of energy", "obviously we would do it more effectively and decisively if from the European point of view we would give a unique answer".

But today he has stated that in reality, there are three simultaneous levels and that he aspires for all of them to move forward.

"We want a solution for all of Europe. Not only a joint purchase but also a cap on gas prices. But being aware that this may take weeks, what we propose is that we respond to the particularity of the peninsula, which has the interconnection minimum it has. Both things are perfectly compatible. There are three steps. Urgent measures aligned with the geographical reality of the peninsula. The second, what Spain has been proposing with Italy, Romania, Greece, Italy, and others, to jointly negotiate the purchase of gas and control the price. And third, a structural reform of the energy market and they are not incompatible things and that is what the government is working on", the president added.

In the last week, Sánchez has been on tour and has achieved support that was not so clear before, such as that of Belgium.

But convince

Germany, Holland

or the very commission that this type of solutions that would fragment, even temporarily, a market that has taken decades to set up, will not be easy at all.

"We show solidarity, responsibility, but being aware that the mix of each country is different, and the interconnections. And not for lack of commitment to the green agenda. 45% of Spanish production comes from renewables and only 10% of the gas, that has to translate into different proposals for the reality of the peninsula", he insisted.

"Even the most doubtful see the technical quality of the Spanish proposal and we hope that in such an important European Council we will achieve a balanced solution for all (...) The important thing is to square this enormous sudoku. What is relevant is to act as we did in the pandemic, united.

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