According to an article released by CSP Today, the solar thermal sector welcomes the establishment of the rate of 6%, given the poor prospects they had in consideration of Soria’s plans which called for a 13% allocation to solar thermal plants. This reversal hapenned as a result of the dispute with Montoro, Minister of Finance, who apparently has family ties with Abengoa, one of the largest CSP developers in Spain. Montoro said that there would be legal problems with the imposition of different rates to what basically was a single product: energy.
The draft bill on Tax for Sustainable Energy, which aims to raise 3,000 million euros a year, has as its centerpiece a flat rate of 6% for all energy generation forms. The solar thermal industry further welcomes the tax on radioactive waste and the 22% tax on the use of water for hydroelectric plants. Similarly it considers acceptable the application of the so-called “green cent” on carbon-based fuels, which will range from € 0.0279 per cubic meter of natural gas to € 14.97 per ton of coal.
Despite this positive step, Luis Crespo, general secretary of Protermosolar underlines a very important detail that could have significant consequences in the solar thermal sector.
If we take a look at page 12 of the proposal there is a clause that states: “The power attributable to the use of fossil fuel in a generation facility that uses as the primary energy source any of the non consumable renewable energies, in no case shall be granted an incentivated economic regime. ”
Protermosolar’s concern is that this may impact the profits from the Spanish solar thermal plants when gas is used as back-up fuel and that this has been taken into account in the business plans of all operators. And the fact is that virtually all solar thermal plants are backed by gas, since the previous law allowed it. Protermosolar believes that removing aids for the production of a CSP plant with gas could affect about 15% of the sector’s profits. According to Crespo, this measure would clearly be retroactive and they are not willing to accept it.
According to Secretary of Protermosolar, there are two clear reasons that make the fee is not as fair as it appears to be. Renewable energy companies will have to bear the tax of 6% (because the law establishes their compensation) while companies producing energy from traditional sources (mainly the electricy giants) may pass the extra cost onto their customers. Spanish consumers are ready for more hikes in electricity prices after suffering an increase of almost 70% in energy costs over the past five years.
The second criticism of the bill is that it is not yet clear whether it will be applied to reducing the tariff deficit in Spain, which now amounts to 24 million euros. “We are concerned that we may have been asked to make this effort and the deficit is not going to be solved,” said Crespo.
It is believed that if the bill is passed as proposed, it is likely that Spanish solar thermal plants will have to refinance several times to maintain their performance, and
potentially this will cause a wave of changes in ownership. “The measure would have a minimal impact on the tariff deficit-Crespo said. But, if applied, it could do a great harm within our industry.