Fight against Spain’s solar cuts taken to Brussels

Share on facebook
Facebook
Share on twitter
Twitter
Share on linkedin
LinkedIn
Share on reddit
Reddit
Share on email
Email

A complaint against Spain’s solar cuts has been lodged with the European Commission.

The changes, passed into law earlier this month, will limit the profits of projects to 7.4% before tax, around 5-5.5% after tax. The cap will be periodically reviewed and could still fall further.

Law firm, Holtrop SLP, which represents 1,500 renewable energy investors, delivered the complaint to the Directorate General for Energy at the European Commission on Friday.

The Royal Decree was approved on 6 June, 11 months after it was first mooted. In addition to the investment cap, punitive charges on self-consumption and reforms to the ways payments are calculated were also approved.

“We think that the system is too complex, the standards and parameters which were published on Friday morning are 1760 pages and it is very detailed. It’s delay tactics,” lawyer Piet Holtrop told PV Tech. “It is basically one huge smokescreen to make it difficult to penetrate in court actions.”

Holtrop claimed that the new system was less about energy policy and more about the government dealing with the sector’s budget deficit, thought to be around €26 billion (US$34 billion).

“They wanted to make sure [the changes] lasted at least two or three years during a court action. Either there would be a new government by then or if not, at least they would have postponed the deficit problem for a few years. It doesn’t tackle the real problems of the energy market like restructuring the wholesale market,” added Holtrop.

A number of bodies including the local government of Murcia and Masdar have separately challenged the law. The case with the EC is designed to add pressure on the courts in Spain to act.

Holtrop believes the domestic courts will offer the fastest route to a resolution but that could still take a year in the best case scenario. If proceedings at the EU level were taken to their conclusion, the Spanish government could be compelled to act.

“The Commission can first send a motivated opinion which would prompt the government to introduce changes into the new system. If they won’t do that it can refer the government to the European Court of Justice, if they win that case they can impose a fine that would be large enough to make it more cost effective for Spain to derogate the new system than to pay the fine,” said Holtrop.

By the time that process had been completed, the government could feel that it postponed the previous framework for long enough.

The impact of changes in Spain and the outcome of the court cases against them could reach further into the EU.

“In the new Lithuanian energy tax, Spain was taken as an example. They explicitly referred to Spain and they copied it. There is no deficit and no economic crisis, just a very strong gas sector which stands to lose out to the renewables sector. It’s a dangerous precedent. If we can get this to [European Court of Justice in] Luxembourg and get a positive ruling, it will also have a very positive effect in other jurisdictions,” claimed Holtrop.

The government has also been accused of weakening the sector’s regulator in an attempt to curb future litigation. Towards the end of 2013, Spain folded the energy regulator into one body comprising all competition and industrial bodies. The energy group at the new independent organisation is led by a former advisor of energy minister Alberto Nadal, who pushed through the controversial reforms.

1 December 2021
Join this virtual conference on 1-2 December 2021 for expert presentations covering PV Module Technology, Supply & Site Optimisation for Utility-Scale. Delegates can access streamed presentations, session recordings and chat/messaging tools to connect with fellow delegates and speakers. Speakers include leading developers, manufacturers, testing and research institutes, including: NREL, Silicon Ranch, Sonnedix, Heliene, Powertis, LONGi Solar, JinkoSolar, PVEL, Risen Energy, Seraphim, STS, Trina Solar, Eternalsun Spire, QEERI, Fraunhofer, Estuary Capital Partners, VDE, First Solar, Longroad Energy, Powertis and DNV Energy Systems
2 December 2021
Intersolar is the world’s leading exhibition & conference series for the solar industry. As part of this event series, Intersolar India in Mumbai is India’s most pioneering exhibition and conference for India’s solar industry. It takes place annually and has a focus on the areas of photovoltaics, PV production and solar thermal technologies. Since 2019, Intersolar India is held under the umbrella of The smarter E India – India’s innovation hub for the new energy world.
9 December 2021
The Smart Energy Council is hosting Australia’s second Virtual Smart Energy Conference and Exhibition on Thursday, 9 December 2021. This event will show that the industry powers on despite COVID-19 and we are standing together undeterred in spirit. Bringing our global community together using the latest technology.
13 January 2022
Intersolar North America and Energy Storage North America “Come Together” for the first time in Long Beach, CA—connecting installers, developers, utilities, technology providers, policy makers, and key stakeholders from around the world to advance the clean energy future. With best-in-class conference programming, integrated exhibits and pavilions, and the live Solar Games installer competition, #isnaesna21 will showcase the industry trends, innovative solutions, and emerging talent transforming the solar, energy storage, and e-mobility markets. Register today to redeem our exclusive offer for PV Tech readers—free expo hall or 20% off full conference pass.
1 February 2022
As Solar Finance & Investment enters its ninth year, we sit on the cusp of a new power market with solar at its heart. The 2022 edition of the event will build on our years of expertise and relationships to bring investors and lenders together with top developers. Connect with leaders in the field and use exclusive insights to drive investment and development decisions for the future. Meet new and existing project partners at the largest gathering of European solar investors and lenders.
23 February 2022
Held annually since 2016, the Energy Storage Summit Europe is the place to be for senior stakeholders in the European storage industry. Designed to accelerate deployment of storage, we examine evolving chemistries, business models, project design, revenue stacks and use cases for storage. The 2022 edition will include exclusive content around longer duration solutions, energy strategies for wide-scale deployment of EVs and "EnTech", the event which sits at the intersection of digitisation, decentralisation and decarbonation of the power system. Come to meet TSOs, DSOs, Utilities, Developers, Investors and Lenders and leave with new contacts, partners and a wealth of information.

Read Next

November 30, 2021
Solar EPC company iSun is investing in US commercial PV project developer Encore Renewable Energy as part of efforts to accelerate its geographic expansion.
November 30, 2021
The CEO of Hevel Group, Igor Shakhray, will leave the company to become CEO of Unigreen Energy, a silicon wafer and cell manufacturer, which is owned by Hevel majority shareholder Ream Management LLC
November 30, 2021
South Korean LG Electronics has announced a series of new appointments as it aims to target greater growth and customer satisfaction moving into 2022, while also elevating certain critical departments to division level in order to supply them with greater resources
November 30, 2021
Solar risk manager kWh Analytics has launched a new offering that it says allows PV project owners to receive upfront payments in return for maintaining asset performance.
November 30, 2021
‘Solar Module Super League’ (SMSL) member Canadian Solar has raised US$150 million through a share offering, with proceeds set to help the manufacturer expand its energy storage arm.
November 29, 2021
Commercial and industrial (C&I) solar developer Altus Power will offer distributed renewables and energy storage solutions through a new partnership with energy major Shell.

Subscribe to Newsletter

Upcoming Events

Solar Media Events
December 1, 2021
Solar Media Events
February 1, 2022
London, UK
Solar Media Events
February 23, 2022
London, UK
Solar Media Events
March 23, 2022
Austin, Texas, USA
Solar Media Events
March 29, 2022
Lisbon, Portugal