COLD WAVE, POVERTY METER

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The storm Filomena has unexpectedly brought the lowest temperatures that the Iberian Peninsula has known, with lows of 30°C below zero in some places1 and entire cities buried in snow2. It has also evidenced the situation of energy poverty of 15% of the Spanish population, about 6.8 million people and 2.6 million households, according to data from the Funcas Foundation and the Chair of Energy and Poverty3, while the electricity price skyrockets. In a situation like this, many families have to choose between warming up or eating.

The maximum price of electricity, the second highest in history, was reached last Friday 8 with 94.99 euros/MWh4, which has placed Spain as one of the European countries with the most expensive energy. The causes of this are diverse, such as the increase in demand due to the cold wave or the low production of renewables due to lack of sun and wind, but economists such as Jorge Fabra Utray, from the blog “Economistas Frente a la Crisis” (Economists Facing the Crisis), have another opinion: “The price of electricity has not been triggered by the cold wave. It has been triggered by the regulation of the electricity market established by Law 54/1997 of the Electricity Sector5, in reference to the electricity liberalization law approved by President Aznar.

The reaction of politicians has been diverse. Alberto Garzón, minister of consumption, has requested an investigation from the CNMC on possible irregularities in the market6, while the economic vice president Nadia Calviño downplayed “specific increases in the price of electricity” despite the reforms in the electricity sector7, and the vice president of Ecological Transition, Teresa Ribera, spoke of “scaremongering” and an increase of “only a few euros.”8 The revolving doors9 between politics and energy companies have led to a “pricing system tailored to the interests of an electricity oligopoly.”10

Reversing the current trend is our duty to solve this serious problem, combat institutional hypocrisy, which has been an active part in a liberalization of the sector that only benefits large energy companies, fight for the nationalization of energy and for democratization of energy resources. Projects such as that of Barcelona Energía11 open the way to other alternatives and show the possibility of building a more just and democratic model.

1 https://twitter.com/pnaltpirineu/status/1346737568830922752  
2 https://www.bbc.com/news/world-europe-55612955  
3 https://www.comillas.edu/es/noticias-cep/20491-se-publica-un-numero-especial-de-papeles-de-energia-preparado-en-colaboracion-con-la-catedra-de-energia-y-pobreza  
4 https://elperiodicodelaenergia.com/8-de-enero-de-2021-el-precio-de-la-electricidad-mas-caro-de-la-historia-el-pool-se-fija-en-los-9499-e-mwh-y-alcanza-un-maximo-de-11489-e-mwh/  
5 https://economistasfrentealacrisis.com/los-precios-de-la-electricidad-se-disparan/  
6 https://twitter.com/agarzon/status/1347528231893807107  
7 https://www.europapress.es/economia/energia-00341/noticia-calvino-avisa-reforma-sector-electrico-no-impide-subidas-puntuales-luz-actual-20210111095615.html  
8 https://elpais.com/economia/2021-01-09/el-gobierno-pide-que-no-se-haga-alarmismo-con-el-precio-de-la-luz-porque-el-recibo-solo-subira-unos-cuantos-euros.html  
9 https://www.yoibextigo.lamarea.com/wp-content/uploads/2018/09/YOIBEXTIGOPUERTASGIRATORIAS.pdf  
10 https://twitter.com/PODEMOS/status/1348284461998362627  
11 https://energia.barcelona/es/barcelona-energia-la-electrica-publica-metropolitana

More Information:

https://economistasfrentealacrisis.com/

https://www.yoibextigo.lamarea.com/

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