The cut in premiums for wind energy in Spain only affects 16% of installed capacity

In recent months the wind energy sector in Spain is suffering from a general paralysis as a result of registration, which has affected the wind turbines manufacturers and component, which has meant the loss of several thousand jobs. The agreement will likely help to resolve the situation.

The cut in premiums for renewables agreed last week between the Ministry of Industry and solar thermal sector employers (Protermosolar) and wind power (Wind Energy Association) was lower than feared.

The Government and the wind energy sector made a pact for a reduction of 35% of the premium received by wind power plants, but only three out of ten megawatts of installed wind energy capacity will suffer this reduction: a total of 3180 MW of wind power is affected by the cuts on a total of 18,500 MW of installed wind power in 2009.

The cause is the different remuneration regimes governing the wind energy sector in Spain, where seven out of ten wind farms installed are not regulated by Royal Decree 661/2007, which is what governs the special scheme, but by one of its transitional provisions, allowing them to keep premiums above.

Thus, about 14,000 of the more than 19,150 megawatts installed in Spain took in 2007 the transitional formula rather than one of the two (plus bonus pool or fee) that is provided in the decree for the wind farm facilities to be put into operation since its entry into force.

Inequality in the premiums will remain only until December 2012 when the cut ends also transition 35% agreed by the sector and the Government, so that from 2013 all the wind farms will be charged the same.

The premiums for all renewable energies could reach 6,800 million euros this year, according to the provisions of the CNE. The amount received by the Concentrating Solar Power (CSP) is very small, for the few operating plants (10 plants with 382 MW) and in the case of wind power are lower than those received by the photovoltaic electricity production.

The Ministry of Industry will limit the hours of eligible produced by photovoltaic solar power plants. The new regulation will not retroactive premiums and respect the legal certainty.

Industry Minister these days are negotiating the agreement with business associations of photovoltaic solar energy. A cut soon be known.