Several people board a carriage at the Gran Vía metro station on January 5. Eduardo Parra (Europa Press / ContactoPhoto)
The Government of the Community of Madrid, chaired by Isabel Díaz Ayuso, had to save the public company Metro de Madrid with a financial injection of 114,374,396.65 euros, according to an agreement signed by both parties and published this Thursday in the Official Journal of the Region (BOCM ). The injection bails out a company plunged into the financial crisis – it had losses of 57 million in 2021 – and which has been choked to the breaking point by the rise in energy prices. As reported by EL PAÍS, the company estimated in its internal forecasts that it would need 150 million euros if energy prices did not fall throughout 2022. The reality now confirms the prognosis almost in the worst case.
“The exceptional increase in energy prices during 2022 has hit Metro de Madrid decisively, given its heavy reliance on this supply to provide its services,” the agreement explains. “Derived from this fact, the actual cumulative expenditure up to October 2022 in this period amounts to 129.9 million euros, compared to an original budget of Metro de Madrid for energy supply of 43.4 million euros. therefore in an increase in extraordinary expenses of more than 86.5 million euros already in the month of September, a number that, given the existing price volatility, could further increase to at least 100 million euros by the end of 2022,” he concludes: “Consequently and in In accordance with the above, it is appropriate to compensate Metro de Madrid for the increase in operating costs as a result of the increase in energy prices.
The imbalance in numbers is already having an impact in practice: the company announced last spring that it would cut the number of trains it serves its one million daily users by an average of 10%, a measure it stopped last year would have. Summer. However, the problem of rising costs does not only have an external origin. But on the contrary.
The President of the Autonomous Community of Madrid, Isabel Díaz Ayuso Gustavo Valiente – Europa Press (Europa Press)
In 2021, Metro used a fixed electricity tariff to protect itself against market fluctuations: it spent 88 million on this concept over the course of the year. But the company gave up this practice by the beginning of 2022 at the latest: As a result, its budgets were quickly exceeded by reality. Thus, the increase between the energy budget and what was actually paid was more than 200%. In addition, two decisions by the central state government are now forcing an additional 14.3 million to be made available for salary increases for employees. A total of 114.3 million is not foreseen in the books of the public company, which is the largest in the region alongside Canal de Isabel II.
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“[El rescate] is the execution of clause 5c of the program contract that Metro signs with the consortium, which covers the possible modification of the fare per passenger carried for such exceptional situations as the increase in energy costs or for other non-budget expenses such as the increase in staff costs due to the salary increase of public servants,” emphasizes a spokesman for the S-Bahn. “In other words, it’s already in the contract, so in reality the energy prices are exceptional, not so much that a clause in a contract between Metro and the consortium was executed.”
Nobody in the hidden society going through a serious moment. Thus, in January 2022, Metro de Madrid CEO Silvia Roldán joined managers of other public transport companies in sending an alarming letter to the central government. “We are asking for help from the Executive Branch to mitigate the increase in utility bills,” read the letter’s summary. In the weeks that followed, the company’s management informed various interlocutors that the regional subway was “in a serious economic situation”. According to internal sources and documents accessed by EL PAÍS, it was even said at these meetings that the public company was at risk of entering “a technical bankruptcy scenario” if energy costs continued to skyrocket, although Roldán himself denies these words to have expressed.
In addition, Metro is in the midst of a reputation crisis unprecedented in its hundred-year history. The front is open to the workers for the deaths caused by asbestos in the network and in the Buenos Aires subway for having sold carriages with this carcinogenic material: Last July, the compensation for those affected was agreed with unions and relatives, as well as for closed cases that may arise in the future, to which will be added the Asbestos Removal Plan, the aim of which is to remove this material from Metro facilities. There is an open legal dispute with Ecuador over the costs of building the Quito Metro. There is the conflict with hundreds of residents of San Fernando de Henares who have had to leave their homes because the 7B line has damaged the foundations. And then there are the complaints from passengers about the waiting times on the platforms and the crowds in the carriages. A complicated landscape, to which must be added the need for constant investment to maintain and modernize a centuries-old transport network. For example, this Wednesday it approved the spending of 16 million to install 387 smart turnstiles in 32 train stations. The plan is to expand this 4.0 model to 137 stations between 2023 and 2029. A drop in the ocean that is choking the metro.
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