Spain's government had approved two new laws designed to reduce costs and increase the control and efficiency of power transmission and distribution. The new laws come on the back of an overarching law passed recently with a principal aim to eliminate the accumulated approximately Eur30 billion shortfall between regulated income and expenditure, known as the tariff deficit.
Among the new measures are stricter control and auditing of assets, a new incentive for distributors to combat fraud, and a cap on annual spending. Small distributors will be given a three-year timeframe to adapt to the new norms.
Spain was recently forced to invalidate its regular quarterly CESUR auction, used to determine domestic tariffs for the upcoming three months, amid accusations of manipulation of the process.
The government was subsequently advised by the competition watchdog CNMC to use a trailing three-month or six-month price formula to calculate the tariffs, which would increase the prices by either 2.9% or 1.4%, depending on which method is used.
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