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Spain

Spain

Qualified relief over Spanish energy bill

SPAIN: The Spanish wind sector has greeted the central government's long-awaited energy bill - finally approved by cabinet on Friday - with tempered relief.

A previous proposed law, drafted in July, intended to clamp 11% and 21% taxes on turnover from wind and solar photovoltaic generation, respectively, compared to 4% from conventional power.

Faced with the threat of legal action for unfair discrimination, the government now proposes a new tax set at 6% of turnover for all electricity generation technologies.

Share values of listed wind and other renewables operators, including Acciona, Iberdrola, Abengoa and Gas Natural, went up between 2.5% and 3.8% on the Madrid stock exchange following the government announcement.

However, the wind sector relief is heavily qualified. "The new proposed rate will drastically impair breathing for small operators rather than strangling us to death," said one developer member of national wind association, Asociación Empresarial Eólica (AEE).

The tax, applied retroactively across Spain's 22GW of installed capacity, will collect over EUR240 million from wind next year, according to calculations by AEE.

AEE laments the fact that the reform was not negotiated with the sector. Also, it says that the bill does nothing to end the government's indefinite moratorium on new capacity after 1 January 2013, which has brought production of new turbines for Spain to a halt this year.

The government is now working to put the bill before parliament.

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