Spain makes new proposal for EU power market reform as seeks deal, sources say

By Pietro Lombardi

VALLADOLID, Spain (Reuters) - Spain has drafted a new proposal on the reform of the European Union's electricity market as it seeks to push the bloc towards an agreement in principle by the end of July, two people familiar with the matter said on Tuesday.

The draft was sent to EU member states last Wednesday, one of the sources said, and the countries were now analysing it. The sources could not be drawn into giving details of the proposal.

EU countries have so far failed to strike a deal on how to reform the market to speed up deployment of renewable energy and shield consumers from price surges, with member states at odds over new state aid for power plants.

Spain, which holds the EU rotating presidency until the end of the year, hopes that informal talks of EU energy ministers taking place in the Spanish city of Valladolid this week will help bridge the different positions, one of the sources said.

Madrid has made reaching a deal one of its key priorities. To this end, Energy Minister Teresa Ribera was taking part in two separate meetings on Tuesday, organised by pro-nuclear and pro-renewables EU countries respectively.

Spain, whose energy policies focus on renewable sources such as wind and solar, will act as "an honest broker", Ribera told journalists on Tuesday afternoon, adding that any agreement must respect some "capital principles".

"We must not incorporate measures that generate distortions in the internal market or measures that endanger the viability of the decarbonisation objectives," Ribera said.

(Reporting by Pietro Lombardi; Editing by Emelia Sithole-Matarise)