Gas Natural urges government to approve energy reform

Jun 20, 2013 - Spanish gas giant Gas Natural Fenosa (MCE:GAS) urged the government to approve its energy sector reform in the next weeks, in order to resolve the uncertainty around the incentives for renewable energy production.

The tariff deficit which is still unpaid to power utilities amounts to EUR 5.171 billion (USD 6.831bn) currently and its growth has to be limited, the CEO of Gas Natural, Rafael Villaseca, said during a conference organised by Banco Santander (MCE:SAN) yesterday.

A total 60% of the costs of the government in the energy sector represent incentives for the production of power through renewable energy sources, which account for 47% of the combined power capacity in the country, he added.

The current scheme under which renewable energy has a priority over the electricity produced through natural gas is not functioning and the government has to address this problem, Villaseca said.

The Spanish energy system generated a tariff deficit of EUR 1.916 billion in the first four months of 2013, up 3.7% year-on-year, according to provisional data issued by energy market regulator Comision Nacional de la Energia (CNE) earlier in June.

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