Spain took steps on Friday to cap the government's growing debt to the energy sector, including ending a link between power tariffs and the consumer price index and restricting pricing options for renewable firms.

The overhaul will save the power sector 600 million to 800 million euros ($821.8 million-$1.1 billion) in annual regulated charges, which account for about half of Spanish electricity bills, Industry Minister Jose Manuel Soria said at a news conference.

The measures are meant to mend a partially regulated power system that has led to a so-called tariff deficit of nearly 28 billion euros ($38 billion), built up over years of keeping prices from rising in line with costs.

As part of the reform, renewable energy companies will be forced to choose between two pricing options, removing previous flexibility and potentially hurting future revenues.

Shares in renewable energy firms Acciona and Abengoa, seen as the hardest hit from the measures, fell sharply on Friday, closing down 13 percent and 5 percent respectively in Madrid trade.

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