Tuesday, October 19

Iberdrola hardens its pulse with the Government with the paralysis of renewable projects


Iberdrola has decided to paralyze the ongoing bidding processes for goods and services associated with the construction of new renewable projects in Spain until a detailed evaluation of the economic viability of these projects after the shock plan approved by the Government to reduce the price of the light. This is indicated by the company in a communication made to suppliers involved in bidding processes for renewables in Spain to which Europa Press had access.

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It is not the first movement before the policies to reduce the electricity bill that the Executive of Pedro Sánchez has implemented. The electricity companies, through the Nuclear Forum lobby, had already launched the threat of “cessation of activity in the nuclear park if the CO2 bill goes ahead in the terms set out” because, it assures, it leads to losses in the reactors, which they provide 20% of the electricity.

The company chaired by Ignacio Sánchez Galán appreciates the participation of the companies that have submitted to the bidding processes for the different projects and ensures that it will inform them of any decision made in relation to these bids. Projects that have a recognized remuneration framework through renewable auctions have been excluded from this communication.

This decision by Iberdrola is the result of a first analysis of the impact that Royal Decree Law 17/2021 has on the profitability of renewable facilities.

The reduction of VAT to 10%, the suspension of the 7% tax on electricity generation, the discount of the electricity tax to 0.5% or the deduction of 2,600 million euros from the income of the electricity companies from the called ‘benefits fallen from the sky’, are some of the measures undertaken by the Spanish Government and included in the aforementioned decree.

The CEO of Iberdrola Renovables Energía, Julio Castro, pointed out this Wednesday in San Sebastián that the measures adopted by the Government to lower the electricity bill are “the imperfect solution in which we all lose”.

In addition, he stressed that in Spain “the last resort” tariff (PVPC) has not been reformed, so that every day “that wholesale market price is transferred to the small customer, and a tsunami of loss of confidence has been triggered in renewables that threatens the ecological transition and decarbonization targets. ”

The average daily price of electricity in the wholesale market again set a record this Wednesday in Spain, reaching 189.9 euros per megawatt hour (MWh). This new increase in electricity is produced in the midst of a rise in the price of raw materials linked to energy in the world, such as gas, oil and coal, as well as CO2 rights, also at historical highs.



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