(Bloomberg) -- Spain is readying a new aid package for power-intensive companies including ceramic and fertilizer makers which are struggling due to mounting energy costs, according to people familiar with the plan.
The government, which is currently discussing the size of the package and whether to extend it to more sectors, could approve the new measures as soon as next month, said the people who asked not to be named on a confidential issue. A final decision has not yet been made, they added.
The socialist government led by Prime Minister Pedro Sanchez has already spent about €35 billion ($36 billion) to shield the economy from the impact of near-record inflation on households and companies with the use of tax breaks and subsidies, including €375 million of direct aid to gas-intensive businesses.
The new fiscal package could condition new aid to plans to spend in energy-efficient plants and to cut the carbon footprint, the people said. The government is also reviewing the allocation of current relief measures, most of which expire at the end of the year, to focus on most vulnerable sectors of the economy, the people added.
When contacted for comment, a government spokesperson referred to comments by Sanchez earlier this week on the plans to support the ceramics industry, the world’s third largest.
Earlier this week, Sanchez said the administration will shield the sector from the impact of soaring gas and power prices, which has already forced some manufacturers to shut down or to scale back output.
Like ceramic makers, fertilizer firms are suffering from high energy prices, as they are big consumers. The problem is acute in Spain because the country is one of the European Union’s largest agricultural producers.
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