According to the press release of the National Markets and Competition Commission (“Comisión Nacional de los Mercados y la Competencia”, hereinafter referred to as “CNMC” by its Spanish initials) published today, this regulatory authority supports the decision of the Spanish government regarding the termination of the renewable energy bonus scheme.
Even though the report on the proposed Royal Decree in relation to the power generation from renewable sources, combined heat and power and waste was adopted by the CNMC on December 17, 2013, the announcement took place today. Through its press release, the regulatory authority takes a positive view of the fact that the incentive regarding renewable energy will be linked not only to the volume of power generated, but also to criteria on an efficiency and effectiveness basis.
Thus, the Spanish government is intending to get rid of the traditional system to stimulate the use of renewable energy (i.e. public subsidies granted to the companies depending on the power generated and the sort of technology used). The new system designed by the Ministry of Industry, Energy and Tourism aims to implement an incentive program that should complement the revenues derived from the sale of power on the Spanish market and should depend on (i) the investment expenses assumed by each project and (ii) the installed power.
The decision of the Spanish government and the support of the CNMC do merit a close attention, especially regarding their potential impact on the investment on renewable energy in Spain, which have sunk dramatically in the past year.