Green subsidies axed to ease Spain's financial crisis


¿Qué?

If you were advising the Spanish government on how to get out of the financial hole they are in, I guess you would say, what is the largest, most pointless waste of money right now? And the answer is:

Spain halted subsidies for renewable energy projects to help curb its budget deficit and rein in power-system borrowings backed by the state that reached 24 billion euros ($31 billion) at the end of 2011. 

“What is today an energy problem could become a financial problem,” Industry Minister Jose Manuel Soria said in Madrid. The government passed a decree today stopping subsidies for new wind, solar, co-generation or waste incineration plants.

The system’s debts were racked up as revenue from state-controlled prices failed to cover the cost of delivering power. Costs have swollen in the past five years because of an increase in regulated payments for the power grid, support for Spanish coal mines and subsidies for renewable energy plants.

“It’s clear they have to make major cuts,” said Francisco Salvador, a strategist at FGA/MG Valores in Madrid. “The government has already ruled out a significant increase in prices, so the cuts will fall in many places and the spotlight is on renewables, but not just on renewables.” (source, via GWPF)

When the patatas fritas are down, expensive, unreliable and inefficient “renewable” energy subsidies are the first to get the chop.

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