Spain Power Reforms to Cost Companies 2.7 Billion Euros

Spain has announced a package of sector cutbacks to address it's enormous tariff deficit.

Spain Power Reforms to Cost Companies 2.7 Billion Euros - Bloomberg:

Spain slashed profit for renewable energy companies and the electric grid operator, part of Prime Minister Mariano Rajoy’s effort to eliminate a 4.5 billion euro ($3.9 billion) deficit forecast this year for the industry.
Industry Minister Jose Manuel Soria said the measures will cost utilities 2.7 billion euros and consumers 900 million euros. The government will absorb a further 900 million euros of costs. The changes take affect tomorrow.
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Deputy Prime Minister Soraya Saenz de Santamaria said today’s announcement will be the “definitive reform” of the electricity system, after a series of stop-gap measures that failed to end the deficit.
Rate Cap
The debt has grown for a decade because regulators cap rates, also known as tariffs, at levels not high enough to reimburse services such as power transmission and generating from more expensive renewable sources.
Renewable energy operators that earn about 9 billion euros a year in subsidies were already hit by a 7 percent tax on their revenue in December and a lower allowance for inflation in February. Spain’s bigg

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