The industrial sector believes that it could be trampled by the reforms that the government is preparing to undertake in order to contain a massive tariff deficit. The sharp increase approved last Friday could be devastating to heavy industry, because all of its costs are off due in the wake of falling demand. That's why thirteen employers' organizations from the automotive, ceramic, paper, metal, smelting, brick, textile, iron and steel, cement, and chemical industries have decided to unite and ask the government to stop increasing the cost of electricity.
The secretary general of the Association of Major Energy Consuming Companies, Fernando Soto, explained to elEconomista that the sector has been hit hard by two percent increases to power tolls in January, and now it fears that the Spanish government could approve another increase of at least 4.47 percent. Big industry has to face these additional costs and also purchase energy in bilateral contracts with power companies. Still, doubts linger in the sector, because even though on Saturday the government published an official report stating it would raise prices of basic materials in order to decrease the tariff deficit, it did not specify that it would raise energy access tolls.
Officially, the Minister of Industry has announced general increases to power costs for mid- and large-sized industry at 2.8 percent and 0.9 percent, respectively. But the exact amount depends mostly on supply contracts that serve to increase tensions. At this time the contracts are not counting on the economic advantages of long-term agreements.
The problem of the most recent increase to power costs exists, above all, because the government has to comply with decrees from the Supreme Court that serve the requests of electric companies and require bill recalculations for the past two quarters, because tariffs set by the government are insufficient.
