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Spain scraps solar tax in energy market

  • 6 months ago (2018-10-29)
  • David Flin
Europe 692 Solar 77

Spain’s new Government has scrapped a tax that had been widely criticised for undermining the development of solar power. This will also reduce the outlook for use of coal in power generation. The plans will be revealed in full in early November, when the draft climate change and energy transition law is published, along with the Government’s National Energy and Climate Plan.

World Congress on Climate Change 2019
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World Congress on Climate Change 2019

Under the now scrapped solar tax, all new and existing solar systems bigger than 10 kW had to pay a generation charge, even when the electricity was consumed on site. In addition to scrapping this tax, the new decree simplifies the technical and administrative requirements for installing small-scale renewables.

Teresa Ribera, the Minister for Ecological Transition, has indicated that the Spanish Government might move towards a phaseout of coal use in power generation by 2025. This might cause the utility Endesa to reconsider plans to upgrade its existing coal plants. Currently, it plans to extend the lives of three coal-fired power plants to 2030 or beyond. These life-extension investments, which will cost an estimated €400 million, are needed to bring the plants into compliance with stricter EU pollution emissions standards that come into force in 2021.