Electricity rates to increase by 6 percent in July

5th June 2008, Comments 0 comments

The rise will cover the increasing cost of power generation and includes measures to help lower-income families cope with rising bills.

5 June 2008

MADRID - Spanish consumers, whose wallets are already feeling the pinch from rising fuel and food prices, are to suffer another blow to household finances in the form of an average five- to six-percent hike in electricity rates from July.

The rise, announced Wednesday by Industry Minister Miguel Sebastián, is less than the 11-percent hike recently proposed by the National Energy Commission to cover the increasing cost of power generation and comes packaged with measures to help the poorest families and encourage people to conserve energy.

The most significant change includes the introduction of a "social tariff" allowing households with a contracted power supply of less than three kilowatts to save 10 percent on their bills.

That level of consumption - barely enough to run a microwave oven and a hairdryer at the same time - is the amount used by 4.5 million households across the country, many of them pensioners.

"It is our duty to look out for the least privileged consumers," Sebastián told the Congress Industry Commission. Consumers who draw "large amounts of power" will be penalised with higher tariffs, the industry minister said.

Though the poor will be affected less, the tariff hike will undoubtedly prove unpopular at a time when many families are struggling, and workers in any sector reliant on diesel or gasoline are fearing for their jobs.

[El Pais / A. Eatwell / Expatica]

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