Final demand: IRE

Increased consumption in the industrial and service sectors.

The evolution of the IRE during 2021 recovered its growth trend but it too was not immune to the effects of the pandemic situation that was experienced as of March 2020 in which periods of restrictions on mobility and the limitation placed on certain activities had an impact on the IRE, especially with the arrival of the fourth, fifth and sixth waves.

In 2021, the overall IRE was 4.7 % higher than in the previous year, an increase that does not offset the decline experienced in 2020, which was -7.4 %. The index closed the year at 120.6, compared with a value of 124.4 in 2019.

All the main sectors of activity that make up the IRE (industry, services sector and the grouping of other activities), experienced a positive variation compared to the previous year, although with different intensities depending on the particular sector of activity:

• Industrial activities grew 5.1 %, showing accelerated growth in consumption after the substantial fall registered the previous year.
• The services sector had a slightly greater impact, with an increase of 5.2 %.
• The grouping of other sectors of activity also increased with a variation of 0.9 % over the previous year, although to a lesser extent than the main sectors.

Breakdown of the General IRE

Annual variation of the IRE

Temperatures had a negative impact of 1.2 percentage points on the evolution of the IRE, by main sectors, the most significant impact was in industry where temperature had an influence of -1.7 percentage points

In 2021, both the composition of the working calendar and the evolution of temperatures had a negative impact on the evolution of the Red Eléctrica Index, with the magnitude of temperature having twice the impact than that of the working calendar.

Temperatures had a negative impact of 1.2 percentage points on the evolution of the IRE, noteworthy were May and July, when temperature had a negative impact of 4.9 and 4.8, respectively. By main sectors, the most significant impact was in industry, where temperature had an influence of -1.7 percentage points on the IRE, followed by the services sector, where temperatures had a negative effect of just over 0.1, and that of the ‘Other’ sectors that had an impact of slightly less than 0.1 %.

IRE: Breakdown of the variation in 2021

%

The monthly evolution of the adjusted index registered positive rates as of the beginning of the year, reaching double-digit variations that had not been seen since the IRE indicator began

The monthly evolution of the adjusted index was impacted by the recovery after the pandemic and its subsequent evolution. It is noteworthy, in any case, that the adjusted IRE had been achieving positive rates since the first months of the year, reaching double-digit variations that had not been seen since the IRE indicator began, as a consequence of the large falls registered in 2020. Thus, in the month of March, still immersed in the second state of emergency at a national level and with negative rates until February, the adjusted IRE increased by 4.1 % with respect to the previous year, but it was in the month of April when it reached a maximum increase of 27.9 %, taking into account that in April 2020 there was a ‘hibernation of the economy’, linked to a general lockdown and the suspension of non-essential activities. In the month of May, the index reflected an increase of 18.5 % with respect to May of the previous year, when there was still a state of emergency and restrictions on mobility. From that month onwards, the index began to register positive rates, although moderate, that continued right up until the end of the year.

With respect to the monthly evolution of the adjusted index corresponding to the two main sectors (industry and services), it should be noted that although all sectors began to recover at the beginning of the year, the progressive recovery of the index did not take place with equal intensity, as while the industry sector registered a positive trend from the outset, the services sector was slower to recover and subsequently rallied later on in the year, helping the IRE to register positive rates in the last months of 2021.

Monthly evolution of the adjusted IRE

Regarding the trend, it should be noted that in 2020 the IRE was showing a downward trend with negative records being set throughout the year, conditioned by the evolution of all sectors, especially the services sector. This situation continued during the first two months of 2021 until, from March onwards, the trend of the index reached a turning point when it started to show positive values in the first months of summer. From that moment on, with the more positive evolution of industry, the trend took an upward turn, although maintaining negative variation rates in its comparison with 2019.

Since 2020, the services sector had been showing a more negative trend compared to the industry sector. The expectations and the relaxation of measures as of the second quarter of the year meant that since March the index of this sector show a clear upward trend that continued throughout the year without showing signs of weakening, which was motivated because this sector includes activities that were more influenced by the relaxation of the pandemic containment measures.

Monthly evolution of the change in trend of the adjusted IRE

At the time of the day when the maximum hourly demand for 2021 was registered, the residential sector accounted for 36 % of consumption, while the industry sector of the IRE accounted for 24 % of consumption, the large services sector in the IRE stood at 10 % and small businesses and services stood at 24 %

At the time of the day when the maximum hourly demand for 2021 was registered, the residential sector accounted for 36 % of consumption, while the industry sector of the IRE accounted for 24 % of consumption, the large services sector in the IRE stood at 10 % and small businesses and services stood at 24 %. Throughout the peak day, the greatest impact of the industry sector occurred in the early hours of the morning, between 3:00 a.m. and 5:00 a.m. reaching a total share of 31.5 % of the demand (as measured at the power station busbars), while for the large services sector, the hourly period with the greatest impact was between 6:00 a.m. and 8:00 p.m. with a share in the demand of around 10.3 %.

Breakdown of the maximum hourly electricity demand winter time 8 January 2021

Breakdown of the maximum hourly electricity demand summer time 22 July 2021