Bolivia nationalises Iberdrola's power distribution subsidiaries

The president of Bolivia Evo Morales has announced the nationalisation of the four subsidiaries of Iberdrola in Bolivia. The concerned companies are the two major electricity distributors Electropaz and Elfeo ,Compañía Administradora de Empresas Boliviana and Empresa de Servicios Edeser.



Through its subsidiary Iberbolivia, Iberdrola owns 89.5% of Electropaz, which supplies more than 470,000 customers in the area of La Paz, and 92.8% of Elfeo (more than 80,000 customers in the Oruro region). The two distribution companies will be taken over by the Bolivian Empresa Nacional de Electricidad (ENDE). Evo Morales also announced that Iberdrola should receive a financial compensation after an independent review of its assets within the next 6 months. The government explained the nationalisation of these two companies aims to ensure equitable electric service rates in the regions of La Paz and Oruro and uniform quality of electricity services in rural as well as urban areas.



In May 2012, Spain transmission system operator REE's 99.94% stake in Bolivian counterpart Transportadora de Electricidad (TDE) was nationalised. In 2010, four power generation companies were expropriated, including two subsidiaries of GDF SUEZ and Rurelec (UK). Nationalisations in the power sectors are based on articles 20 and 378 of the Bolivian constitution (energy production chain in the stages of generation, transmission and distribution may not be restricted solely to private interests). Since 2006, about 15 companies were nationalised in strategic sectors (oil, mining, cement, etc.).