Spain plans 'additions' to controversial power bill claw-back law

Ribera told lawmakers she hoped to come up with "additional measures" in the coming weeks, adding on Twitter that these would give "reasonable prices to industry and more protection to vulnerable consumers". She gave no further details on what the additional measures could be but shares in the most-affected companies nonetheless recovered some of the ground they had lost since the decree was unveiled.


Reuters | Madrid | Updated: 14-10-2021 23:04 IST | Created: 14-10-2021 23:00 IST
Spain plans 'additions' to controversial power bill claw-back law
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Spain plans to introduce "additional measures" to a controversial bill that claws back profits from power companies in a bid to protect consumers from sky-high energy prices, Energy and Environment Minister Teresa Ribera said on Thursday. Companies including wind energy leader Iberdrola have complained to the European Union about the decree, which was part of Spain's response to a global spike in power prices caused in part by high demand from economies recovering from COVID-19, and low gas stocks.

The bill originally envisaged skimming some 2.6 billion euros off the companies' earnings, but the cost is now likely to be higher because it is linked to gas prices that have climbed even further since it was introduced. Ribera told lawmakers she hoped to come up with "additional measures" in the coming weeks, adding on Twitter that these would give "reasonable prices to industry and more protection to vulnerable consumers".

She gave no further details on what the additional measures could be but shares in the most-affected companies nonetheless recovered some of the ground they had lost since the decree was unveiled. Iberdrola shares traded up more than 2%, having previously shed 7.5% of their market value since mid-September. Enel unit Endesa, which unlike Iberdrola operates only in Spain, climbed more than 3%, having previously lost more than 10%.

"It is a positive message to give regulatory security and speed up the energy transition, but my question is whether the approved regulation could bring about precisely the opposite," said Fernando Garcia, director of European utilities equity research at RBC Capital Markets. "I hope these words signal a return to more reasonable regulatory measures," he added.

After a heated debate, Congress ratified the decree with 182 votes in favour and 150 against, although the regulation was technically already in vigour. (Additional reporting by Jesús Aguado and Belen Carreno; Editing by Kirsten Donovan)

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

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