Last week the Spanish government announced plans to cut subsidies for solar photovoltaic (PV) power by about 75%.
Although the nation expects to surpass its 2010 goal for installed
solar by four fold, the down side is that generous subsidies for the
industry have resulted in a ballooning tariff deficit for the country,
which has risen to 4.85 billion euros, upfrom 745 million last year.
Reuters reported that lending to the Spanish photovoltaic plants
has risen to $3.59 billion in the year to day, up from $230.9 million
euros last year and $192.44 million in 2006.
As a result, the Spanish government will as the energy regulator
to cap subsidies for new PV solar capacity at 300 megawatts (MW) per
year–200 MW for rooftop systems and 100 MW for ground-mounted systems,
which have been the highest growth area.
The current cap is 1,200 MW, for which solar power generators
receive a subsidy of 0.45 euros ($0.713) per kilowatt hour (KWh). Under
the new plan, subsidies will decrease to 0.33 euros/KWh for rooftop
systems and 0.29 euros for ground-mounted. The plan is expected to go
into effect Jan. 1, 2009.
Solar stocks have been pushed down in recent weeks, as rumors surfaced about the expected change in subsidies.
However, Spain’s Industry Minister Miguel Sebastian said
yesterday the cuts will not apply to soalr thermal power, also known as
concentrating solar power (CSP), according to a Reuters report.
Stocks in the Spanish solar thermal company Solaria (AOR.BE) reportedly rose 25% on the news.
CSP has been slower than PV technology in its emergence on the
renewable energy scene, but expectations for the technology, which
focuses the heat of the sun to produce steam to drive electricity
producing turbines. Projects underway in the U.S. and Spain are
expected to produce electricity that is cost-equivalent to electricity
produced from burning coal or natural gas.
Germany’s Solar Millennium helped develop Spain’s Andasol 1
solar thermal project, Europe’s first such plant, which is due to start
power production in October.
In the U.S., CSP developer Ausra recently opened a facility near Las Vegas to begin producing reflectors to be used in large installations in the region.
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