Energy companies experienced notable falls in the stock market on Tuesday in the early stages of the session, after Pedro Sánchez’s announcement on Monday night to stop the escalation in the price of light.
Endesa led the falls, with a decrease of 4%. Iberdrola followed, which started the day with a 2% decline, and recovered to a 1% drop. Red Eléctrica (-0.38%) and Naturgy (-0.27%) also fell at the beginning of the day. In addition, other energy companies also fell on the stock market: Solaria (-1.68%), Repsol (-0.44%) and Enagás (-0.40%),
The Council of Ministers approved on Tuesday a new package of measures to cushion the rise in the price of electricity in the wholesale market, with the aim that Spaniards pay an amount similar to that of 2018 at the end of this year.
Specific, The Executive will give the green light to the suspension until the end of the year of the 7% tax on electricity production and it will reduce the special tax on energy from 5.1% to 0.5%, which is the minimum required by community legislation, as announced yesterday by the Prime Minister, Pedro Sánchez.
Within this package of measures, Sánchez explained that “they will detract from the extraordinary benefits that energy companies have” to redirect them to consumers, “bumping” the gas bill and thus reducing the electricity bill.
“They can afford it and we are going to redirect it to consumers.”Sánchez emphasized yesterday in an interview on TVE, in which he reproached that “it is not reasonable” for these companies to have such extraordinary benefits at this time. “We all have to be in solidarity and we all have to make an effort,” he remarked.
This government shock plan to lower the electricity bill comes in a moment in which electricity prices in the wholesale market move above 170 euros per megawatt hour (MWh).