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Spain’s sunshine toll: Row over proposed solar tax

solar power plant, la robla in leon
Image caption The renewable energy sector has suffered a series of setbacks in Spain

"We will be the only country in the world charging for the use of the sun," says Jaume Serrasolses.

"Strange things are happening in Spain. This is one of them."

Mr Serrasolses, the secretary of an association promoting the use of solar energy, SEBA, is referring to the government's proposal for a tax solely on those who generate their own electricity.

They would pay a backup toll for the power from their solar panels, in addition to the access toll paid by everyone who consumes electricity from the conventional grid.

Although the tolls vary, if you pay an access toll of 0.053 euros per kWh, you could face a backup toll of 0.068 euros per kWh.

The new tax would extend the average time it would take for solar panels to pay for themselves from eight to 25 years, according to the solar lobby.

The government says that with increasing "self-consumption", the income for conventional energy systems will decrease, but grid maintenance will cost the same.

"If I produce my own energy, but am connected to the grid, having the backup in case my production fails, I have to contribute to the cost of the entire system," says Energy Secretary Alberto Nadal.

The government is hoping the energy reform will settle a debt of 26bn euros (£22bn; $35bn), which has built up over years as a result of regulating energy costs and prices.

Image caption A banner in Catalan reads: "Free use of the sun. Nuclear? No, thank you"

Broken promises

This is just the latest in a series of setbacks for the renewable energy sector.

The government has gradually lowered a feed-in tariff - a scheme that paid people to produce their own "green electricity" - first reducing the period over which it was paid, then limiting it to already existing installations and finally an energy reform in July opened up the possibility of withdrawing it retroactively.

At the same time it has not endorsed net metering, a policy allowing solar panel owners to send surplus energy to the grid and use it later. The idea was part of a previous proposal but was not included in the latest reform proposal.

But while the government may have been heavily promoting solar energy six years ago, those who followed that lead may now pay dearly for their investment.

"The majority are people like your or my parents who at one time had savings and wanted to make an investment with a better return," says Piet Holtrop, a Dutch lawyer who is defending over 1,000 of them.

Image caption Piet Holtrop says the situation in Spain could affect policies elsewhere in Europe

"Many of these people are going to lose their houses (that they used as collateral to buy solar panels). They are unable to pay back at the bank. They can't sell the installations, because the government has made them toxic assets," Mr Holtrop says.

Though many people believe the government has succumbed to pressure from the big five energy companies, Mr Nadal insists that "solar energy is much more expensive than that mass-produced by large utilities".

He adds that Spain is now paying for being at the forefront of solar energy development: "If we hadn't rushed into constructing large quantities of photovoltaic installations, we could have had them much better for [a] much lower price. It would have been much better introducing them step by step."

Resistance

The backup toll, still to be approved, has already paralysed the photovoltaic sector. "Nobody is going to make significant investment if it takes over 20 years to pay it off," says Jaume Serrasolses.

However, the proposal has also prompted defiance.

Ricard Jornet has fitted his beachside restaurant with 36 solar panels. Alongside other efficiency measures, they have cut his electricity bill by 40%.

Image caption Ricard Jornet's organic restaurant sits just outside Barcelona

To avoid the backup toll, he plans to split the restaurant so that it uses two independent electricity systems, with only 30% connected to the grid. The rest will be self-sufficient, thanks to insulation and batteries storing the produced energy.

"I will save more money, because for the little part of the restaurant I will pay smaller access toll. I will also prove to the government this is not the way to do things."

Civil disobedience is another option, despite hefty fines of up to 30m euros.

Oriol, a chicken farmer, is willing to take the risk of undeclared self-consumption. "I believe they will warn me first. Then... we will have to invent another way to save the situation."

The fines were originally designed for electricity companies and have to be approved by a cabinet council.

"The more people disobey, the more difficult it will be to fine them," says Jaume Serrasolses.

Legal battle

Spain's energy regulator has sided with the opponents of the toll. It has found the proposal discriminatory, concluding that it makes self-consumption economically unviable and sacrifices middle and long-term economic efficiency for short-term economic sustainability. However, the regulator's word is non-binding.

There are hopes that the European Commission will help, as its objective is to achieve 20% of energy production from renewable sources by 2020. The body is currently probing one of several complaints against Spain's energy policies.

Image caption Mr Serrasolses says imposing fines for undeclared self-consumption could be difficult

However, the Commission might have a dilemma.

"They are anxious to not jeopardise the plans for Spain's economic recovery," says Piet Holtrop.

"We are afraid the Commission is willing to sacrifice the EU legal framework for policy objectives."

Other countries are carefully watching developments in Spain. The governments in Latvia, the Czech Republic, Italy and Greece seem to be pondering similar cutbacks.

"We want to make the Commission aware of the spillover effect," says Mr Holtrop.

The backup toll may not end up being introduced, but the proposal has put many people off installing solar panels in the meantime, which means they are still getting their energy from the five big suppliers.

"I think they (the government) know this proposal does not make sense. They just want to gain time," says Ricard Jornet.

"[And] during all these months the energy oligopoly is making thousands of millions of euros."

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