20 Jul, 2010 @ 11:21
1 min read

Burn out in Spain

By Sara Wallace

HUNDREDS of solar power projects could burn out under a new plan to cut government subsidies.

The schemes – many of them set up with foreign money – will go bust, if the Spanish government goes ahead with a planned 30 per cent cut in support for the schemes.

The retroactive cuts would bankrupt hundreds of projects already underway, in addition to threatening plans for future solar initiatives.

Many entrepreneurs and private equity groups from the UK and elsewhere in Europe have financed renewable energy projects in Spain, lured by government subsidies that promised guaranteed returns for 25 years.

Spain is currently one of the world’s biggest providers of solar power, but that could all soon change.

Estimates say roughly four billion euros of equity invested in Spain would be lost if the proposed cuts come in.

The threat to impose the retroactive cuts has already caused three companies working with solar energy—Engyco, T-Solar, and Renovalia—to delay projects.

Banks are also worried about being stuck with bad loans, as they have provided financing for about 50,000 solar plants in Spain that would be affected by cuts.

Jon Clarke (Publisher & Editor)

Jon Clarke is a Londoner who worked at the Daily Mail and Mail on Sunday as an investigative journalist before moving permanently to Spain in 2003 where he helped set up the Olive Press. He is the author of three books; Costa Killer, Dining Secrets of Andalucia and My Search for Madeleine.

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1 Comment

  1. Just like ghost towns we will have ghost power-plants all over Spain (If they ever do that to nuclear power-plants we’ll have to move to another planet soon).
    Ultimately more industry and banks will go bust, more unemployment, even less money circulating, less consumption, even less industry and banks, more unemployment, less tax-income. We are already spiralling out of control thanks to the corruption in the construction industry.
    Before you know it soon to be underpaid bureaucrats, colonels and generals will get the idea again…

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