Industry, Energy and Tourism Minister José Manuel Soria on Wednesday insisted that the decision by the antitrust watchdog, the CNMC, to suspend the outcome of a December wholesale electricity auction that would have meant a huge increase in rates charged to consumers was justified.
In a report issued Tuesday the CNMC determined while there were “atypical circumstances that impeded the auction from taking place in an environment with sufficient competitive pressure,” there were no clear signs of collusion to manipulate prices and that no further action would be taken against 36 power companies and financial intermediaries. The CNMC said it would “continue investigating” the auction.
The decision to annul the tender, the first time this has happened, was “well founded,” Soria said Wednesday before attending a meeting of the executive committee of ruling conservative Popular Party.
The minister said that since the auction the Industry Ministry had held talks with the chairmen of the five biggest power companies, with representatives of consumer protection groups and the financial intermediaries that took part in the tender. Soria said the institutions that took part acknowledged that the way auctions are structured needed to be improved.
The CNMC’s rider in its decision not to initiate sanction proceedings allowed Soria to save some face. Right after the auction, the minister said there had been “coarse manipulation” in the tender, raising the hackles of players in the sector, who urged the government to repeat the process.
If the result of the auction had stood, consumers would have faced an increase in power bills of 11 percent at the start of this year. The price rise was quashed by the intervention of the government, which decreed that electricity rates would instead go up by 2.3 percent at the start of 2014.
The European Federation of Energy Traders on Wednesday issued a statement in which it claims there was “damaging interference” in the December tender.