Excessive payments to EDP were discussed in parliament today, the veteran communist leader, Jerónimo de Sousa, calling on the Socialist Government to end EDP’s "excessive revenues" and use the money to invest in better public transport.
In the fortnightly parliamentary debate with the Prime Minister, the secretary general of the Communist Party said "why must consumers pay these millions of profits for the big energy companies by paying for the most expensive electricity in Europe," referring to the latest row over the hideously complex Power Acquisition Contracts and Costs to Maintain Contractual Equilibrium (CMEC) which electricity consumers have been paying for since market deregulation.
"This is an immense fraud of millions in profit to a monopoly, It’s the result of what has been done by successive governments: super-profits, derived from the monopolistic position of EDP," said de Sousa.
“In the last ten years, these payments have amounted to around €4 billion. Will the government join the Portuguese Communist Party in seeking to end this unacceptable scandal in which those who pay are the families and small and medium-sized enterprises?" asked the CPC leader.
This CMEC business dates back to the last decade when the State agreed that customers should compensate EDP for the cancellation of energy purchase contracts with its supplier, REN, so that everyone could enter the unregulated energy market from July 1, 2007, without any ongoing supply contracts getting in the way.
António Costa tried to dodge the issue in parliament today and wimbled on about ‘the lowest increase ever this year in electricity prices, and the ‘expansion in the social tariff that now covers 800,000 families’ but did not address the rip-off of the decade where consumers pay EDP compensation for broken supply contracts.
Smiley Costa shared our pain and added that there may be a way of sorting out this enormous annual burden shouldered by electricity consumers, but warned that EDP “had been docile but had turned hostile” since the government changed.
Heloísa Apolónia, a Green Party MP, also questioned the prime minister on the excessive revenues that EP is piling up, noting the "deep national shame" that these "excessive energy revenues" exist and that it’s consumers and taxpayers who are being made to pay up and that “the Portuguese are tired of paying for banks and big energy companies.”
"You need to end this," she said to the PM, who answered everyone's EDP questions with, “there is a legal framework and a contractual framework that must be respected,” adding, rather helplessly, that large companies, such as EDP, "have several ways, with the help of regulators, of overcoming and circumventing the law.”
After the National Anti-Corruption Unit raid on the EDP and REN head offices on June 2nd, investigators now are looking at looking at the privatisation of EDP, the broken contract compensation payments and various dam operation contracts including at the Baixo Sabor dam, approved by the Government of José Sócrates, where the Public Ministry now is investigating suspicions of corruption and bribes involved in the design of the work.
Another team is focusing on the Sines Thermal Power Plant, operated by EDP, where an anonymous complaint was received specifying that the company was granted an operating license without public tender and without having to compensate the State with any contra payments.
The police now want to interview the former minister, Manuel Pinho, but if the PM continues to complain that it's all too much trouble, we will have to rely on the courts to order compensation payments if EDP is found to have acted illegally, as well as immorally.
EDP's boss, António Mexia, earned €2.1 million last year boosted by an extraordinary bonus of €360,000 for "leadership qualities and strategic vision." It is not known hoe he reacted to having his computer seized by officers of the National Anti-Corruption Unit.
See also: 'EDP head office raided in corruption probe'