Power companies operating in Spain are negotiating with the government for a quarterly revision of electricity tariffs, a change from the current annual review that will bring electricity in line with gas.

Generators are also in talks with the ministry for industry in a bid to make changes to cost of fuel charges, arguing that electricity tariffs do not cover generation costs. Under current laws, annual increases in electricity charges are capped at 2% until 2010, but generators hope to ensure an average annual electricity tariff increase of at least 3% over the next decade.

According to power companies, regulated rates that apply to nearly 25 million consumers do not reflect the real costs of generating power and are heavily influenced by politics.