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Latino Daily News

Saturday December 29, 2012

Bolivian Government Takes Over 4 Spanish-owned Firms

Bolivian Government Takes Over 4 Spanish-owned Firms

Photo: Iberdrola

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President Evo Morales announced Saturday the nationalization of four Bolivian units of Spanish utility Iberdrola, including the main electricity distributors in La Paz and Oruro provinces.

“We have seen ourselves obliged to take this step to make the charges for electric service equitable in the provinces of La Paz and Oruro and the quality of electric service uniform in rural and urban areas,” the leftist president said.

The nationalization decree applies to power distributors Electropaz and Elfeo, services company Edeser and investment firm CompaƱia Administradora de Empresas.

All four are majority owned by Iberdrola subsidiary Iberbolivia.

As in previous nationalizations, the Bolivian government will hire an independent auditor to determine the amount of compensation to be paid to Iberdrola, the president said.

La Paz has yet to come to an agreement with another Spanish utility, Red Electrica EspaƱola, on compensation for the nationalization in May of its stake in power distributor TDE.

Bolivian state utility ENDE will assume control of the four former Iberdrola units, Morales said.

The president said he nationalized Electropaz and Elfeo because of the wide gap in the rates charged rural and urban customers in La Paz and Oruro.

In La Paz, he said, the average rate for urban customers is less than a penny per kilowatt-hour, while rural subscribers pay 23 cents for the same amount of electricity.