The PSV (Punto di Scambio Virtuale, Virtual Trading Point) is where natural gas changes hands on the Italian wholesale market. It matters to a business for a practical reason: according to ARERA, the Italian energy regulator, in 2025 86.2% of non-household customers on the free market had a variable-price contract and, among these, 75.4% were indexed to the PSV. Understanding how that index becomes a price in EUR/Smc is the first step in checking the invoice.
What the PSV is
It is not a physical place. Snam's Network Code defines it as a virtual point located between the entry points and the exit points of the national gas pipeline network, where operators can carry out, on a daily basis, trades and transfers of gas already injected into the network. It is managed by Snam Rete Gas, which records the transfers of ownership in the operators' daily balances.
Two kinds of transactions converge at the PSV: bilateral contracts between operators (OTC) and trades concluded on organised markets, namely those run by GME and, since 2015, foreign exchanges offering products with delivery at the PSV.
PSV day-ahead, monthly indices and GME prices
"PSV price" is a generic expression. In a contract it can mean different things:
- PSV day-ahead: the price of gas for delivery the following day, traded OTC and assessed by specialised agencies (in its own analyses ARERA uses the PSV price sourced from ICIS).
- Monthly index: the average of the daily prices of a month. This is the form ARERA uses for the CMEM,m component of the protection service for vulnerable customers, calculated as the monthly average of the PSV day-ahead and published within the first two working days of the following month.
- GME market prices (M-GAS): on MGP-GAS gas is traded for delivery on the following days, on MI-GAS for the same day; GME acts as central counterparty. Since July 2023 GME has also calculated the IGI (Italian Gas Index), derived from MGP-GAS trades.
In 2025 these references moved together: on an annual average, IGI and PSV day-ahead differed by a few euro cents per MWh (ARERA). In a single month the gap can be wider: the contract must state which index applies, for which month and published by whom.
From EUR/MWh to EUR/Smc: how the price is reached
On the wholesale market gas is quoted in EUR/MWh, that is, in energy. The invoice is in EUR/Smc, that is, in volume. The conversion requires a gross calorific value (PCS in Italian bills): the amount of energy contained in one standard cubic metre.
ARERA publishes its values for supplies with a reference calorific value of 0.038520 GJ/Smc. Since 1 MWh equals 3.6 GJ, one Smc contains 0.0107 MWh: the price in EUR/Smc is obtained by multiplying the index in EUR/MWh by 0.0107. A purely numerical example, not a quotation: 40 EUR/MWh correspond to 0.428 EUR/Smc; with a spread of 0.03 EUR/Smc the commodity price is 0.458 EUR/Smc. Each euro per MWh more or less is worth about 1.07 cents per Smc: for a site using 500,000 Smc a year that is 5,350 euros.
The spread is the mark-up the supplier adds to the index to cover its costs and margin: it is the part of the price on which the negotiation focuses.
For a business: what to look at
- In the contract: the exact name of the index (PSV day-ahead, IGI, other), the reference month (the delivery month or the previous one), the publication source, the calorific value used for the conversion and the rounding rules.
- The spread: is it in EUR/Smc or in EUR/MWh? Is it fixed for the whole term? Two offers can be compared only with the same index and the same unit of measurement.
- On the invoice: for points below 200,000 Smc a year, ARERA's billing rules (resolution 315/2024/R/com) require the bill to show the price formula and the values taken by each of its elements in the billing period. Above that threshold the contract applies: it is worth having it state that the index applied and the conversion coefficient appear on the invoice. The bill also shows the conventional calorific value of the locality (P) and the C coefficient.
- The decisions it affects: staying indexed or fixing the price for part of the volumes, and when. It is a matter of price risk management.
- Typical mistakes: comparing a spread over the PSV with one over the TTF as if they were equivalent (see what the TTF is); building the budget on last month's price; forgetting that the index concerns the commodity only, while transport, distribution, levies and taxes follow their own rules.
Updated PSV and TTF values are on the Market indices page; reading price formulas is part of our gas consulting for businesses.
To check how the price in your contract is built, IPGS ENERGY is available: Request a conversation.
Sources
- Snam — Codice di rete (Glossario) (accessed 10 October 2026)
- ARERA — Relazione Annuale, Stato dei servizi 2025, volume 1 (accessed 10 October 2026)
- ARERA — Valore CMEMm - Servizio di tutela della vulnerabilità (accessed 10 October 2026)
- ARERA — Glossario della bolletta dei clienti finali per la fornitura di gas naturale (accessed 10 October 2026)
- ARERA — La bolletta dei clienti finali di energia (Allegato A alla deliberazione 315/2024/R/com) (accessed 10 October 2026)
- GME — M-GAS (accessed 10 October 2026)
Informational content by IPGS ENERGY. Information is reviewed as of the stated update date and does not replace a contractual, tax or regulatory assessment specific to an individual business.
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