DOMESTIC AND industrial consumers will see their electricity bills cut from September 1 for the rest of the year, following an announcement by the energy regulating company (ERSE) on June 20 of a mean price reduction of between 2.5 and 3.5 per cent.
The reduction is part of a government initiative to harmonise tariffs, considered an important factor in the liberalisation of the energy market in the Iberian Peninsula.
The Portuguese and Spanish governments signed a plan on the Mercado Ibérico de Electricidade (Mibel), the Iberian electricity market, in March with the aim of converging the tariffs.
2008 increase
Other actions being taken in Portugal include the end of Contratos de Aquisicão de Energia (CAE), energy acquisition contracts, which will be replaced by a new regime allowing producers of electricity, in particular EDP, to pay more than 700 million euros to regulate dam concessions.
Part of this money will be used to pay the tariff deficit and cover the expenses of the tariff reduction. This initiative also means that from 2008 there will be a moderate increase in electricity prices that will avoid nasty surprises for families and businesses.
The Mercado Ibérico do Gás Natural (MIBGAS), Iberian natural gas market, is far behind however. Both countries have decided to prepare an agreement by October on the maintenance of Iberian natural gas reserves and their storage.
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