Iberian gas prices for electricity producers fall below cap for the first time
LISBON/MADRID, Oct 19 (Reuters) - Iberian wholesale market gas prices extended their steep decline on Wednesday, with the day-ahead contract falling for the first time below the cap of 40 euros per megawatt/hour set in May for gas-fired power plants, official data showed.
The platform that manages the Iberian market, dubbed Mibgas, said the auction of gas for electricity producers, held on Wednesday morning, set a price of 31.77 euros per MW/hour for the day-ahead contract, compared to 41.49 euros in the auction held on Tuesday.
As a result, Thursday will be the first day since the Iberian mechanism to decouple the price of electricity from the price of natural gas will not be used since it has been adopted in May.
The European Commission at the time allowed Spain and Portugal to initially cap prices at 40 euros per MW/hour, with the price limit projected to average out at 50 euros over the following 12 months. (Reporting by Sergio Goncalves and Belén Carreño; editing by Inti Landauro and David Evans)