Renta 4 | Possible new measures to bring the price of electricity down. According to the press, the Ministry of Ecological Transition will force the four big producers (Iberdrola, Endesa, Naturgy and EDP) to sell 6% of its generation to provide liquidity for bilateral contracts. The aim is to link 10% of the PVPC to the result of these auctions.
Whatsmore, the implementation of the Recore is being considered, making it possible for them to stop participating in the wholesale market and receive a price of 57-60 eur/MWh.
Valuation: We will see if these new measures, previously already put forward, are finally approved. And, in the case of the primary auctions, we still do not understand where the output they want to auction will come from. This is because the companies usually sell all their production ahead of time, so this could generate some imbalances in the supply. And where the price we understand will be adjusted to the wholesale market, so the desired effect will not be achieved. The Recore a priori only has an impact on the companies’ liquidity and not so much on the returns. We believe the prices being touted by the press would not imply very significant changes with respect to the levels the legislation itself puts forward.