January 28, 2023

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The price of gas is going down but the bills are going up: the loud reason

Why do prices go down and bills go up? This is where you should look for the answer, in the calculation mechanism.

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the Gas prices Generally it goes down but the bills go up, why is this happening? In December they increased by 23.3%. To find the answer, you need to look at the calculation mechanism, calculate the average for the month compared to the previous one.

for Understanding nature In this problem we must start from the changes made by the authority to the methods of calculation due to the crisis that arose after the Russian invasion of Ukraine. In particular, this phenomenon affected the ways in which the cost of raw materials is updated.

So quotes The wholesale market is no longer the starting point for calculating the price of gas under the protected regime. In practice, the gas price is determined by looking at the average Italian market price.

Because the bills keep going up

Gas fire bill rates
Gas photo horizonenergia.it pinterest

the Invoice rates It continues to increase exponentially, but what does all this depend on? The price refresh rate is now monthly rather than quarterly as before. At the beginning of the month, the Energy Regulatory Authority publishes the reference values ​​for the previous month. This means that risk coverage costs are not transferred to bills. It also makes it possible to intercept benefits from lower bids faster as it happens at this point.

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So it is price formation mechanism It takes into account the average of the previous month and since there were increases in the first half of December compared to November, the final result is still an increase.

In the the first half of the month In December the prices were very high and the prices amounted to between 130-135 euros per megawatt, while instead in the second half of December, thanks to the climate and the different perception of Europe’s ability to operate in this sector and then also taking into account the impact of stocks more complete than it was Predictably, we had a major crash. So today we are at 80 euros per megawatt.

looking for JanuaryIf the downward trend in natural gas prices continues or if there are no increases in the monthly average, there will be the first positive effects on bills, with a decline that begins to offset the sequence of increases recorded in the past months.

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This is given to tariffs regulated by Arera, A protected market. Those in the free market, the majority of Italians, should instead wait for contracts with variable prices to reflect changes in market prices or, in the case of fixed-price contracts, look for operators who have chosen to lower their prices.