Valencia expected to take legal action against Spanish Sun Tax

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The Spanish region of Valencia is expected to take legal action against the central government’s recent approval of a punitive law on the self-consumption of solar, the so-called ‘Sun Tax’, according to the head of the country’s solar association.

Earlier this month Spain’s energy ministry passed the new regulation for self-consumption, which included a controversial tax on energy produced and consumed even without feeding it to the grid. The move was branded as a deliberate attempt to avoid the development of PV and self-consumption within Spain, by the Union Espanola Fotovoltaica (UNEF).

However, José Donoso, UNEF general director, has told PV Tech that the region of Valencia will take legal action against the central government for this law, adding that UNEF itself also plans to make a legal challenge.

Donoso said that several regions, including Extremadura, Murcia, Navarra, the Basque Country and Andalusia are all in favour of self-consumption and critical of the government’s new law. These regions perceive that self-consumption of solar is a way to create local employment and local development while also increasing competition at small and medium enterprise level. As a result they want to give grants to consumers to compensate for the Sun Tax.

Valencia specifically has already announced that it plans to implement a fiscal exemption from the IBI, which is a municipal tax relating to the buildings on which solar systems are installed. It plans to reduce this tax by 50%. Meanwhile it is also planning to simplify administrative issues such as licensing and regulation to help the progress of self-consumption.

Donoso pointed out that all the political parties apart from the Conservative party are against the Sun Tax, which is a pertinent observation given that Spain faces a general election in December.

He said that Pedro Sanchez, general secretary of the socialist party, had made the following statements at a recent socialist party presentation on 23 October: “We will eliminate the Sun Tax that is included in the Royal decree of self-consumption. We will create a green fund for the energy transition.”

Sanchez also said that his party had organised a signed agreement between all the political parties that were not currently in power, that they would remove the new law should they come into power.

Donoso added: “In the meantime, we expect that this law will have a short life and maybe after the next general election will be cancelled.”

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