Energy reforms have become a heinous ordeal for the Spanish government. Animosity between the Ministry of Finance and the Ministry of Industry has been consistently high as Cristóbal Montoro and José Manuel Soria, ministers of the two departments, fight about how to split up the tariff deficit in the national budget. There is a 40 billion euro deficit this year, most of which corresponds to making electricity on the islands, creating extra costs for producing power outside mainland Spain.
At first the government was going to take on around 2 billion euros of the tariff deficit. And that is what Montoro is vehemently opposed to, because the Finance Ministry is also struggling to get Spain to meet its EU-imposed deficit objective.
Although trimming the nation's tariff deficit is the main priority, becuase doing so will help both power companies and consumers, whatever the government does not pay for will still be factored as a tariff deficit.
As Spain prepares to cut renewable energy tarriffs, hopefully the nation will be able to forge stronger energy laws and eliminate unfair subsidies so that the price of energy is closer to its production costs.