The PSVDA indicates the reference price of natural gas on the Italian market; it is an index used in the Italian energy market to define the wholesale natural gas price for the day following the trading day.

It is determined by the daily price quotations of transactions carried out at the trading point managed by Snam Rete Gas, the company responsible for gas transport through the national network.

The trend of the PSVDA is influenced by factors such as supply and demand, as well as climatic and geopolitical conditions. The calculation is performed using the arithmetic mean of daily gas quotations, converted from €/MWh to €/scm, taking into account the calorific value of the gas.

The calculation of the PSVDA index is based on the arithmetic mean of daily gas price quotations, known as the “Heren Day Ahead Price.” These quotations are expressed in euros per megawatt-hour (€/MWh) and are converted into euros per standard cubic meter (€/scm) using a multiplicative coefficient. This coefficient takes into account the calorific value of the gas, which is typically 0.0381 gigajoules per standard cubic meter (GJ/scm). The conversion formula is as follows:

€/scm = €/MWh × 0.0105833

Daily gas price quotations are influenced by a number of factors. Among the main ones:

• supply and demand: an increase in demand or a reduction in supply can cause prices to rise. Conversely, a decrease in demand or an increase in supply can cause prices to fall;

• climatic conditions: periods of intense cold or extreme heat can increase the demand for gas for heating or cooling, thereby influencing prices;

• geopolitical tensions: such as conflicts or sanctions, can disrupt gas supply and lead to price fluctuations;

• price trends: of fuels such as oil or coal can influence the price of gas, as fossil fuels are often interchangeable in certain applications.