social tariff will cost 40 million a year to EDP – Daily News – Lisbon

Antonio Mexia said yesterday in London, in the presentation of the strategic plan until 2020 that the company is “working for Portugal to adopt the European philosophy”

the social tariff of electricity will cost 40 million euros per year to EDP, said CEO Antonio Mexia, yesterday in London at the presentation of the new strategic plan by 2020 and you want invest seven billion euros (see box at right).

According to the manager, this is the cost estimate for the company considering a universe of 500,000 families. However, this is the target set by the previous government of Passos Coelho. The objective of the current executive is another and far more ambitious: one million families. That is, the annual cost to the social tariff could be thrown into double: 80 million

But this estimate of Mexia is based on a different premise.. According to the CEO of electric, EDP is working with the state on a different solution to the social tariff, because it considers that the current design is “not fair” or “efficient”. “We are working so that Portugal adopt the European philosophy and not the location,” he said in response to one of the analysts at the meeting, but without detailing how he was doing.

Mexia remembered only what already had said on other public occasions, namely that despite considering the social tariff “a good tool for social inclusion”, funding should be according to “European best practices” because “it makes no sense to be the power generators pay “

Now the European practice which states are two:. or is the State to finance or are the remaining consumers, as in natural gas, and both in its entirety. So far, the social tariff of electricity was supported in part by energy utilities and one third by the state, but the current government decided to change this and passed legislation that makes this third is also supported by companies and EDP will that pays more because it is the one that has more plants to produce electricity.

Impact 200 million

the method of financing the social tariff is not the only measure the government, in this case the current, with which the EDP does not agree. In the last four years that lasted the previous strategic plan (2014-2017) were several cuts that the company claims to have suffered through unilateral decisions of the executive and the most obvious was the extraordinary contribution to the energy sector (CESE), charged only those who produce energy.

according to Mexia, only this rate had an impact of EUR 200 million in the company’s accounts since 2014. And joining the new way of financing social tariff that now lies ahead this impact “exceeds EUR 200 million,” he said, without specifying values. According to António Mexia it was even one of the reasons for the company not be able to further reduce the debt, despite increased investment discipline and cost cutting. In fact, the presentation of the strategic plan 2020 were exposed a few measures to reduce the debt that remains at EUR 17 billion. EDP ​​appears to be counting on the fact that “the markets are more open” and the company “have less funding costs.” That’s why the electrical CEO insisted that the EESC has to end “as soon as possible.” “Several reversals were made. I see no reason for this reversal is not extended to the Committee,” said the manager, who still only expected to happen in 2020.