Published on June 24th, 2014 | by James Ayre4
Spain Approves Bill To Retroactively Cap Solar Investment Returns
June 24th, 2014 by James Ayre
A new bill that will retroactively limit the returns that investors can collect on solar PV projects was recently approved by the Spanish cabinet.
The bill — which has remained somewhat controversial since its proposal last year — will put a cap on the profits of projects at 7.4% before tax, and 5.5% after tax. The cap isn’t set in stone, though, and it’s possible that it will fall even lower than this after review.
Image Credit: Solar Field In Spain via Shutterstock
The content of the bill will be applied retroactively from July 2013 onwards as well as, of course, applying to new installations.
“The Royal Decree approved by the Council of Ministers penalises not only the past but also the future,” stated Jose Donoso, director general of the trade organisation La Unión Española Fotovoltaica (UNEF). “With the legal uncertainty that has been created for our country, it will be very difficult in the future to convince investors that come to this area, or only do so with a risk premium that will hurt the competitiveness of technology.”
Even though the bill has already been approved, there’s still a chance of it being struck down by the country’s courts, something that UNEF intends to pursue — with the charge that the changes are in violation of EU directive 2009/28/EC.
In related news, a new study from the University of Valladolid has found that Spain possesses somewhere around 700 GW worth of potential geothermal energy capacity, easily enough to power the whole country. Of course, as of right now, the country has exactly 0 GW worth of geothermal capacity. 🙁