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Spain to cut energy taxes amid anger over soaring electricity costs

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By AP
Spanish Prime Minister Pedro Sanchez pictured at the Moncloa palace in Madrid.
Spanish Prime Minister Pedro Sanchez pictured at the Moncloa palace in Madrid.   -   Copyright  AP Photo/Manu Fernandez
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Spain’s government has introduced a series of measures in an attempt to drive down household electricity costs.

Prime Minister Pedro Sánchez said he wants to curtail the "exceptional benefits" for energy companies under current regulations.

Wholesale electricity prices have surged to record highs in recent months and triggered outcry from consumer associations across Spain.

Spanish news agency Europa Press has reported that electricity costs are more than 250% higher than one year ago.

Sánchez said that among other measures his government intends to scrap a 7% tax on power generation. A separate energy tax is to be cut to 0.5% from 5.1%

The move to slash energy taxes aims to shift fiscal benefits to Spanish customers. Speaking to public broadcaster RTVE, Sánchez also expressed hope to head off a potentially sharp increase in natural gas prices.

The Spanish government says the hikes in electricity bills are driven by spiraling prices of so-called carbon certificates, which give companies the right to release carbon dioxide.

Surging domestic prices are also an issue in other European countries. Spain’s environment minister recently sent a letter to the European Commission, stressing the need to reform the bloc’s electricity market.