MADRID: Spain and Portugal reached an agreement with the European Commission Tuesday to slash electricity prices on the Iberian Peninsula, under an exemption allowing them to separate it from the price of gas.

According to Madrid, around 40 percent of households should benefit from the system, and between 70 and 80 per cent of companies will be affected.

“We have reached a political agreement with the Commission”, said the Spanish Minister for Ecological Transition Teresa Ribera, at a press conference in Brussels with her Portuguese counterpart Jose Duarte Cordeiro.

The deal, which should come into force in the next few days, will help “strengthen the protection of Spanish and Portuguese consumers... who have a higher level of exposure to the evolution of the wholesale market,” she said.

At the end of March, the European Union authorised Spain and Portugal to take “exceptional measures” to reduce the price of gas used to produce electricity and to alleviate household energy bills, which are particularly high in the two countries.