The president of the Spanish Photovoltaic Association (AEF), Juan Laso, has denounced that the Ministry of Industry intends to cut by about 900 million euros the annual premiums to the photovoltaic industry and also do it retroactively.
According to Laso, the Government's intention is to approve before the end of the year a royal decree law that, based on "examples" included in the Renewable Energy Plan 2005-2010, applies a 30% cut in the number of hours to which the facilities are entitled to receive the premium, so that fixed plants can only charge up to 1,250 hours per year, and plants with a tracker up to 1,644 hours a year.
This cut would mean reducing by approximately 30% the hours of remuneration and, with it, the premium received by photovoltaics, which, if taken as a basis the 2,735 million euros of remuneration planned by AEF for 2010, the measure would allow Industry to contain the costs of the electricity system by about 900 million.
AEF indicates that the measure would be applied to the plants of Royal Decree 661/2007, so it would have "retroactive character", and ensures that it would mean the "bankruptcy" of the sector, since from a cut in income of 10.5% the plants would already enter into 'default' and would stop responding to the payment of the debt, given the bank commitments of many of them.
The sector has a leverage level of 80% on investments of 20,000 million. This exposure to the banking system means that, in Laso's opinion, the cost "in terms of debt and discredit of the measure" that Industry supposedly shuffles far exceeds the savings in premiums pursued by the Government.
In a meeting with journalists, Laso also said that photovoltaic has already been, with 600 million in three years, "the technology that has contributed most to savings in the system" and considered that, if applied, the measure would bring "defenselessness" and would mean "a surprise", "a breakdown of trust" and a "tremendous stick" for the sector. "They are burying years of human, financial and technological effort," he said.
The cut would affect 95.5% of the total photovoltaic park and about 60,000 small investors. In addition, it would aggravate the employment problem of a sector that has gone from 90,000 direct and indirect jobs to just 21,000 in two years, says AEF.
JUDICIAL MEASURES.
The association is willing to promote an appeal of unconstitutionality against the possible royal decree law of the Government. To this end, it has resorted to the services of Clifford Chance, which recommends raising a contentious-administrative appeal against the act of promulgation of the royal decree law, so that the lawsuit reaches a higher court of Justice that, in turn, transfers the case to the Constitutional Court.
The vice president of AEF, José Luis Martínez Martín, explained that the measure could appear included in a law accompanying the General State Budgets (PGE) in which other last-minute measures appear, in addition to photovoltaic cuts, including some referring to the coal sector.
In parallel, AEF is studying to appeal to the Supreme Court, arbitration courts and the European Commission the royal decree already approved in which the premiums to the new photovoltaic plants are cut, since its articles include a limit of 25 years in the period entitled to receive premiums from the facilities of 661/2007 that, in the opinion of the association, it could be a retroactive measure.
ADJUSTMENT OF THE ELECTRICITY TARIFF.
The new pay cut could be applied "temporarily" and for a limited number of years, Laso said. In any case, it would mean about 2,700 million in three years and, added to the 600 million premium reductions planned from next year, would place the effort in savings made by the photovoltaic sector at about 3,300 million.
The saving of €900 million in 2011 would reduce the costs of the electricity system and, with this, would cushion the foreseeable increases in the Tariff of Last Resort (TUR), on which upward pressures of close to 10% currently weigh derived from concepts such as the increase in energy prices or capacity payments to cover the royal decree on coal.
"You can not fix the tariff deficit with measures of this type," said Laso, who recalled that the participation of renewables in the electricity pool has a cost that is offset by the entry of more expensive thermal power that they avoid.
In any case, AEF says that Industry has left photovoltaic associations out of the reflection on cutting electricity system expenses. Not only "there is now no channel of communication" with Miguel Sebastian's department, but "our positions are at the antipodes, because they want to break us," Laso said. (EUROPA PRESS)
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