Mariano Rajoy’s pledge to tax utilities and power consumers signals Spain is planning to raise cash from renewable energy for the first time, a blow to an industry already struggling with subsidy cuts. It could wipe out 75 percent of equity in Spain’s renewable industry.
The prime minister told Parliament yesterday he’d impose a levy to spread the expense of closing a gap between costs and revenue in the country’s electricity business, which has racked up debts of 25 billion euros ($31 billion). Details may be announced as early as tomorrow after the weekly Cabinet meeting.
Extending the treasury’s net to cover wind and solar power is part of Rajoy’s 65 billion-euro austerity package aimed at curbing the deficit. Fund managers from HSBC Holdings Plc (HSBA) to Deutsche Bank AG (DBK) and developers are lobbying the government to restrain the scale of the taxes, saying higher fees may tip companies into bankruptcy.
“The new taxes that are being considered are astronomical,” Miguel Salis, chief executive officer of Eolia Renovables SA, a Madrid-based wind and solar farm developer. “They represent 9 percent to 20 percent of gross revenue for these plants, which would create several problems, including many solar plant defaults.”
First they come up with a “carbon tax,” then this “non-carbon tax.”
There is no limit to governments’ imagination for seeking out new revenue streams.
This move should be an advance warning for investors in wind energy world wide . The penny is beginning to drop that you connot supply mains electricity from weather dependent sources ( river hydro excluded ) . Taxing renewables is a safe way for governments to go . Contracts are not broken but the effect is to reduce renewables profits . This is the way all renewables will go . They dont work , never have and never will . In fact electricity bills are being seen as a way to raise taxes and renewables are no exception . So : invest and be taxed is the maxim . Val Martin Kingscourt County Cavan Ireland . I am not afraid to debate this with any one . The evidence is that with 50 , 000 industrial turbines world wide . Not one conventional plant has been shut down . In feat 2 old coal plants have been taken back into service in Germany
You were warned about advertising Scott – all your comments will now be held for moderation –Ed.
Alas, the article did not live up to my first impression of the headline. I briefly thought that a tax on the Greens was in the works. Greenpeace, Friends of the Earth, the WWF, etc. have literally hundreds of EURmillions in annual revenues. And in a very straight-forward, uncomplicated and obvious way, they’re public relations/advertising firms. So tax ‘em! They’re in business like anyone else.
Binned as advertising — Ed.