The new measures will cap the rate of return for renewable energy projects at 7.5%, which UNEF notes is well below tax rates.
A group of Spanish renewable energy associations have strongly condemned the new funding method for renewable energy introduced by the ruling Popular Party, calling it a “disguised appropriation process”, as well as associated retroactive feed-in tariff cuts.
Notably, the Spanish Photovoltaic Union (UNEF), The National Association of Photovoltaic Energy Producers (ANPIER), The Association of Renewable Energy Producers (APPA) and Protermosolar state that the “reasonable return” of 7.5% for renewable energy projects is well below tax levels, and that the measures increase financial risk. UNEF is also planning legal action against the program.
“The new measures for the electricity sector are severely retroactive and violate the legal certainty of the nation,” declared the organizations. “This violation of legal certainty, will, in turn, lead to the bankruptcy of many investors, particularly families, who will be unable to make payments on debt and will have to turn over their renewable installations to financial entities.”
The organizations complain that the regulations were drafted with a lack of dialogue, including no dialogue whatsoever with the renewable energy sector. They further complain that Royal Decree-Law 9/13 replaces the current payment program with one that its run on the basis of “unknown parameters”, calculated by the government itself, resulting in a reduction of more than EUR 1.3 billion (USD 1.7 billion).
These organizations estimate that the current retroactive feed-in tariff cuts total 15% of revenues, and when added to pre-existing cuts, this reaches 40% the revenues originally promised under the program. UNEF expects the new law to be passed at the end of September or early October 2013.