Spain Ejects Green Energy Lobby
by Alex Morales and Ben Sills, Bloomberg
Spanish renewable-energy companies that once got Europe’s biggest subsidies are deserting the nation after the government shut off aid, pushing project developers and equipment-makers to work abroad or perish.
From wind-turbine maker Gamesa Corp. Tecnologica SA (GAM) to solar park developer T-Solar Global SA, companies are locked out of their home market for new business. These are the same suppliers that spearheaded more than $69 billion of wind and solar projects since 2004 that today supply more than 50 percent of Spain’s power demand on the most breezy and sunny days.
Saddled with a budget deficit more than twice the European Union limit and a ballooning gap between income and costs in its power system, Spain halted subsidies for new renewable-energy projects in January. The surprise move by Prime Minister Mariano Rajoy one month after taking office helped pierce investor confidence in stable aid for clean energy across Europe.
“They destroyed the Spanish market overnight with the moratorium,” European Wind Energy Association Chief Executive Officer Christian Kjaer said in an interview. “The wider implication of this is that if Spanish politicians can do that, probably most European politicians can do that.”
Spain’s $69 billion of investment in power capacity from 2004 to 2011 was about triple the spending per capita in the U.S. in that period, according to Bloomberg New Energy Finance data and U.S. Census Bureau population estimates. Most of the 2012-2013 spending will be for the legacy of projects approved before the aid cuts to wind, solar, biomass and co-generation.
…
After four successive reductions in subsidies since then, the government on Jan. 27 this year announced the moratorium on aid for new projects. The next month Spain saw itself drop out of the 10 most attractive markets for renewable-energy investors for the first time, due to reduced aid, on an Ernst & Young ranking. Spain led the list from October 2003 through July 2006.
“What happened in Spain is that abruptly, they changed the industry by changing the policy, and that doesn’t help build a sustainable industry,” said Stephan Ritter, general manager of General Electric Co.’s European renewables unit.
Full story here at Bloomberg
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Regarding that last line from Stephen Ritter….who seems clueless about “sustainability”…
A sustainable industry is one that stands and competes on its own, not one that is dependent on the government teat.
Related articles
- Renewable energy investors fear UK dash for gas, says Ernst & Young (guardian.co.uk)
- Gas rebranded as green energy by EU (guardian.co.uk)
Perhaps economic reality is sinking in folks, why pay more for less?
“…companies are locked out of their home market for new business.”
Locked out?! How’s that work? No it just means that the gov’t spigot has been shut off. If you were at all commercially viable this would have no bearing on your business, if anything it would be better.
Epoxological Paradox: How can Sustainable Green Energy be sustainable if you remove taxpayer subsidies and it fails?
Whale Oil is sustanaible, petroleum isn’t.
“Green energy companies off the government teat in Spain, take off”
No…they just changed teats…
The words sustainable and renewable have apparently been redefined. They seem to mean now that the grant funding and subsidies are renewable, and the government will sustain them.
I really don’t get how people can call an industry “sustainable” when it costs billions in taxpayer dollars to keep it afloat. First rule of government spending: if it won’t happen without government intervention, it’s not a good business plan.
Well, it should be the first rule of government spending.
Save this article. In two or three years, you can just change every occurance of “Spain” to “Germany” and reuse it.
“What happened in Spain is that abruptly, they changed the industry by changing the policy, and that doesn’t help build a sustainable industry,” said Stephan Ritter…
To build a sustainable industry, all government subsedies must be witheld.
government subsedies = unsustainable
Let’s give credit where credit is due. The Green Energy industry successfully tapped into a vast reserve of an enormously flexible & adaptable resource. Unfortunately that resource has turned out to be more finite than supposed. The name of the resource? Gullibility.
If this were an intentional strategy, it would be brilliant:
1) Temporarily subsidize capital-intensive renewables with a feed in tariff to get lots of stuff built.
2) Stop the subsidies for all projects, existing and new
3) let companies go BK and let banks silly enough to lend to them eat the losses
4) solar and wind plants get bought from bankrupt companies for their fair market value and produce low cost energy
Leo Morgan: That depends on whether the Earth is continuously producing oil or not. There is an argument being put forward about that but I don’t know if it is good or bad, the data will tell in time. If that is true however your point is wrong and the science is not settled. The question then becomes at what rate is it produced and what would be a sustainable usage rate. Which is a totally different economic question. Also we could send missions to Jupiter’s moons, I understand there are oceans of distillable fuel products there. Just need to build a space super tanker to go suck it up.
I was being a little sarcastic, but it seems each time we improve our drilling technology and look a little deeper we find another 100+ years supply. Of course getting the government to approve going to get it under public lands seems to depend on the administration in charge and how well the CAGW meme supports their geopolitical theories.
That famous line is absolutely true…
Sooner or later you run out of other peoples money.
Already happened in Ireland, Greece, Italy, Portugal, Spain. When the fit hits the shan in France, Germany, and the USofA, this gig will finally be over and we might actually start rebuilding a sustainable economy.
Gas rebranded as green energy by EU (guardian.co.uk)
This article referenced above at the foot of the story shows that there might be a sneaky back door return to sanity going on. The Guardian, of course, is spitting blood.
Only in the world of AGW madness is the loss of direct government operating subsidy associated with an unsustainable industry. This perspective demonstrates that non-rational thinking is at the heart of AGW.
vboring says:
May 30, 2012 at 9:10 am
If this were an intentional strategy, it would be brilliant:
1) Temporarily subsidize capital-intensive renewables with a feed in tariff to get lots of stuff built.
2) Stop the subsidies for all projects, existing and new
3) let companies go BK and let banks silly enough to lend to them eat the losses
4) solar and wind plants get bought from bankrupt companies for their fair market value and produce low cost energy
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“produce low cost energy”? If they were producing low cost energy, they would not be going broke. Do you believe in the Tooth Fairy as well?
The US can LEARN from Spain after the election: Applying a
“Moratorium” = Freezing (putting on hold) of executing
previous bad legislation……also putting on hold of subsidies
and green hand-outs
…… I hope they will do it…
“that today supply more than 50 percent of Spain’s power demand on the most breezy and sunny days.”
50%??
Is that correct?
The reality of ‘sustainable energy’ is that it is in fact unsustainable, it does not provide the energy a nation needs at the quantity or price needed to sustain a vibrant economy. That is the lesson of Spain and it could not be simpler or plainer to see. Spain is just at the start of its painful journey from fantasy economics encouraged by Brussels to a return to reality based economics. But then again the Brussels plan has always to effectively destroy each regional economy in turn in order to efect and enable their total absorption.
To escape from a disaster like the CAGW fraud and its ‘sustainable’ lies and deceptions you have to comprehend and then accept where you went wrong, this admission has yet to be made and only the realisation that Spain has no money left and that in itself will not fix the problem. Nations like Spain are going to confront the same issues, the UK is heading towards that cliff and shows no signs of heeding the lessons of Spain.
Ken Smith: I think that’s related to the one of the two items Einstein said are infinite, that he was sure about. Human stupidity.
“The wider implication of this is that if Spanish politicians can do that, probably most European politicians can do that.”
Nobody is safe while the legislature in session. Some people seem to not know that.
I hear the subsidies for solar power in Spain were so high in you could make money by aiming electric lights at your solar panels.
The Spanish energy policy’s over the last 10+ years were the equivalent of a man shooting himself in the head. Now a brain surgeon is attempting to remove the bullet, repair the damage tissue and retrain the brain functions. A long and tedious job with no guarantee of success.
Good luck with that Spain.
This same story can apply to many other County’s, States and Provence’s, that many of us live in. The scramers, white collar crooks and government allies have taken raided the treasures and financial earning ability’s of the people, made a few wealthy and impoverished the many.
It’s a crime!
I like this statement;
” …that today supply more than 50 percent of Spain’s power demand on the most breezy and sunny days.”
Notice the qualifiers ‘on the most breezy and sunny days’.
The World Bank says total Spanish production of alternative energy is 14.8% of total use. With a normal 30% capacity factor for alternative energy, 50% when operating becomes about 15% annualized. But of course the 50% number looks so much better for the Greens, just hope people don’t catch the qualifier.
“that today supply more than 50 percent of Spain’s power demand on the most breezy and sunny days.”
My BS-o-meter started ticking like crazy when I read this … so correct me if I’m wrong but …
Usually when it’s windy, it’s overcast
Usually when it’s sunny, there’s not a lot of wind.