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'€30 million fines for solar producers a joke'

George Mills · 22 Oct 2013, 14:14

Published: 22 Oct 2013 14:14 GMT+02:00

Spain is punishing "a small but growing segment of the middle class" who have installed solar panels to generate their own electricity, the influential business daily reported on Sunday.

The Wall Street Journal (WSJ) said that while European countries like Germany and Italy have jumped on the solar energy bandwagon, Spain policy flip-flop is hurting what was once a budding industry.

Whereas Spain once flung money at companies who set up solar power programs in the country, it now plans to slap people who create their energy for personal consumption for a fee.

The plan is to raise cash to help pay off the Spanish government's 'tariff deficit', or the difference between the cost of operating the country's electricity grid and the money it rakes in.   

"We’re afraid to make decisions, to invest a single euro," Spanish energy consumer Diego Nicolás told the WSJ.

Having spent €42,000 ($57,000) on solar panels to generate his own power, he now wonders how long it will take to recuperate that cash. 

"They take away laws, they put in new laws, prices change. It’s like being in a bullring with four doors and not knowing from which one the bull is going to charge."

Around 5,000 homes have installed solar panels since the country legalized self-production of electricity in 2011.

But green groups say the new regime with its high fees could kill off this promising development.

"It’s like buying a more-efficient refrigerator that uses less electricity and having to pay a charge for what you’re no longer buying from the electrical system," said José Donoso, director general of Spain’s largest solar-industry trade association.

Even worse, if consumers fail to pay those fees, fines could come in at a staggering €30 million.

That's "equivalent to what a nuclear-power producer might pay for a radioactive leak that endangers public safety", the WSJ reported.

The business paper's roundhouse punch comes after other attacks on Spain's solar energy regime.

In August, Forbes took the country to task for its 'ridiculous' plan.

Story continues below…

The US magazine wrote: "You get the feeling that government officials were out of ideas, stared up at the sky one day and thought, 'I've got it! We’ll tax the sun!'"  

Australia's Business Spectator also published a story on the same subject under the headline, "Spain's solar stupidity".

It said: "Imposed by decree, the reform aims to raise money for tackling a €26 billion debt to power producers which the state has built up over the years in regulating energy costs and prices."

Spain's Industry Minister Jose Manuel Soria has defended the law saying: "I support 'autoconsumo' [independent power generation by households]... but the power system has infrastructure, grids that the rest of us Spaniards who are in the system have to pay for. And we pay for it through our electricity bill."

George Mills (george.mills@thelocal.com)

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