Solar industry in Spain is facing troubles following the government’s decision to revise the subsidies for renewable energy producers. This includes measures to limit and tax solar power generation, and curtailing the country’s feed-in tariff program.
The government on February 3 released their plans to cut subsidies and laid out new formulas for calculating overall reduction in subsidy payments to solar and wind farms and other renewable-power producers.
The final proposal will be announced after getting response from the industry, government sources said.
The proposal to reduce renewable energy subsidiary comes as a response to the increasing cost of running nation’s power grid. The tariff deficit accumulated so far is estimated around 30 billion that ultimately will be passed on to taxpayers.
The new formula, if implemented, will have a serious impact on the renewable energy industry in Spain, say experts.
AEE, Spain’s wind energy association, said wind farms representing 37 percent of the country’s installed wind-power capacity would receive no further subsidies whereas the rest of the wind farms will see their subsidies halved.
Meanwhile Spain’s National Association of Photovoltaic Energy Producers (ANPIER) termed the new proposal as “neo-despotism” and demanded that authorities hold a consultative national referendum about the chosen energy model.
The association accused the government of favoring the obsolete nuclear infrastructure in the country. They argue that if the nuclear project is replaced by renewable energy sources, it could create thousands of new jobs as well as sustainable and clean energy at a cost of around €50 ($67.56) per megawatt hour.
On the other hand the price of nuclear energy tops €100 ($135) per megawatt hour if all nuclear generation costs are internalized.
The market is already facing decline in the demand for solar photovoltaic panels. The government’s decision to cut renewable energy tariffs will further aggravate the situation, the agency said. It will also reduce the employment in the sector by almost half.
A report from REC Agents Association reveals that the solar PV industry employed about 13,600 as of late 2013, and the number will sink this year to about 12,300 across about 4300 businesses as state-based subsidies are wound back.
picture source: greenprophet.com