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Shock u-turn by Spanish government appears to clear the way for new renewable energy projects

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A sudden and unexpected repeal of Article 4 of Royal Decree 6/2009 establishing a mechanism for the registry of preliminary assignment of remuneration for future renewable energy projects (excluding photovoltaic) appears to have lifted the fog of uncertainty surrounding new wind, solar thermal electric, biogas and co-generation projects, which have been in hiatus awaiting release of the registry by Spain's Ministry of Industry.

Royal Decree (RD) 6/2009 was approved on 30 April 2009 and established certain measures for controlling new renewable energy projects, including: caps limiting new capacity, guarantee deposits for new projects, and a registry in which new projects must be filed to benefit from current feed-in tariffs. Delays in publishing this registry and the Ministry of Industry's reticence to communicate with sector players has led a number of renewable energy sectors such as the concentrating solar power sector entering into a state of limbo pending further advances.

In a shock move late on Wednesday, the Spanish Senate approved a new law regulating listed real estate investment companies, which strangely repeals Article 4 of RD 6/2009 establishing the registry of preliminary assignment of remuneration.

End to registry of preliminary assignment of remuneration

The repeal of Article 4 still has to be approved by Spanish Congress, but if passed, it will mean the end of the system of control that the Ministry of Industry established to closely oversee future renewables projects, cap new production capacity, and assign tariffs. The sector will return to being regulated by RD 661/2007, effectively clearing the way for developers to move forward with projects in the pipeline without having to wait for the publication of the registry. This move comes in spite of the fact that, in September, the Ministry of Industry approved the first 36 requests for inscription on this registry.

Sources at the Ministry of Industry have declared to Renewable Energy Magazine that for the moment, "the Ministry will await the outcome of the vote in Congress, as the repeal passed by the Senate has no value until it is ratified by Congress", where it will be tabled in one or two weeks. The Ministry of Industry added that, “… the objective of the repeal is the same as that of the registry of preliminary assignment of remuneration: avoid speculation and establish an exhaustive system for controlling the renewable energy sector to ensure objectives are not exceeded. The only difference is that CiU [the political party responsible for the repeal] is looking for a different means, as it considers that the registry of preliminary assignment of remuneration limits autonomous regional governments’ powers.”

It is too early to say what repercussions this latest news will have on the Spanish renewable energy industry and has merely heightened confusion surrounding RD 6/2009. Sector players are trying to assimilate the implications of this sharp u-turn by the Spanish administration, and neither they nor the Ministry of Industry are prepared to comment until it is approved in Congress. For the time being, the only advice offered is to watch this space.

For additional information:

Spanish Ministry of Industry

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