The amendment to a draft electricity bill was deemed credit negative, taking Iberdrola to medium investment grade, Baa negative, along with the other main players, Italy’s Enel, Endesa and Gas Natural.
Iberdrola has the second largest deficit exposure at €1.26 billion or 35 per cent of the total behind Enel’s €1.59 billion. “These amounts would be a drain on the companies’ cash flow unless they can quickly securitise the deficits,” warned Moody’s.
The deficit arose from between the shortfall between the charges for both network and green energy and the tariffs the companies are allowed to charge consumers for those. The government decided it could not cover the deficit and balance its budget