26-03-2015

Major scandal on renewables finance scheme in Spain

The last of many retroactive cancellations of financial support to renewables in Spain came in  June 2014 and meant a drawback of another 30,000 M euros in the renewable sector to added to previous cuts. According to the Government, feed-in tariff was to blame for the rise of electricity bills as this increased the generation costs, and increased as well the tariff deficit.

Therefore the Government took another decision against renewable production. This decision was apparently sustained by reports commanded to two consultancy companies chosen arbitrarily by the Industry Ministry. They wanted apparently and independent assessment. NGOs, platforms and renewable sector have demanded for months and on the basis of transparency legislation, the access to these reports to assess their reasons and evidence to justify these new abuses against renewables.

It has turned out that the reports were commanded ad hoc to the consultants Roland Berger and Boston Consulting, but they were ordered to give recommendations that were compliant with the thesis of the Governement. The companies were first reluctant to endorse the Government so they were threatened with cutting their fees for the work. The outcome was that BCG finally rejected and waived their fees, and Roland Berger indeed produced a report in support to cuts to renewables, but they did at 5 months AFTER the Ministry made the cuts official.

The scandal appears near to the general elections and is likely to be the last hit to the renewables, or at least the last one that producers are willing to stand. For this reasons, as part of the national energy coalition Amigos de la Tierra has reclaimed in the courts against the Industry Minister for an offense of trespass. If we win, it will be a huge legal victory.

Author: Friends on the Earth Spain