Endesa asks for 10% increase of regulated price

SPAIN (Agencies) The electric company's Managing Director, Andrea Brentan, has launched an appeal to the Government for an increase of between 10% and 15% in 2012 of the part of the final consumer price that is regulated by the Ministry of Development (known as 'access tariffs' or 'peage'), aimed at "stopping the generation of a deficit and the difference between income and system costs". Brentan made his appeal and the comment that '"a couple of increases in a couple of years will be enough" after the company's annual shareholders meeting, comparing it to the increase of the same tariffs by 10% in April. The price of electricity is made up of two components:>

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The access tariffs or peages, which are about half the consumer cost, are set by ministerial order and are aimed at financing the system and other items such as renewable energy premiums.

The second component, the electricity itself, comes from an auction on the open market.

After the (so-called) revisions (a euphemism for an increase in our bills) of January and April, the Government has to again 'adjust' the tariff for what is known as Tarifa de Ultimo Recurso (TUR, 'last resource tariff' - what a name!) to which some 20 million consumers are ascribed. The 'adjustment' is due in June.

Electricity went up by 9.8% in January because of an increase in energy costs, and the peages were frozen. Adversely, the tariff was maintained in April as the peages went up by 10%, while saw material went down.

Endesa showed a profit of €4,129millions for 2010.