Banco Sabadell : According to press reports, and confirming rumours that have been appearing in the press over the last month, the National Markets and Competition Commission (CNMC) is moving forward with its decision to approve a 6.5% remuneration for electricity distribution networks and 6.4% for gas for the next six years.
Assessment: As for electricity, although the news is negative, it was already known that the proposal being considered by the CNMC was close to 6.5% for electricity rather than the 7-8% requested by the companies (and compared to 5.50% currently). It is estimated that this could mean €1,000 million less revenue. This proposal also contravenes government guidelines, which last October urged the CNMC to guarantee sufficiently attractive remuneration so as not to limit network investments. We understand that negotiations with the sector will continue, especially after recent events where network investments seem even more important. Within the electricity sector, in order of exposure to the network business, Redeia stands out (75% EV; although this would be the high voltage networks) and in the integrated networks Endesa (52% EV), with Iberdrola (15% EV) and Naturgy (14% EV) far behind.
As for gas, the sector is asking for a level of 7% against 5.83% currently and the largest exposure would be to Enagás (76% EV) and Naturgy (19% EV).
