Spain must avoid disrupting market, says Oettinger
By Marie-Martine Buckens | Friday 06 July 2012
The new slashes to subsidies for renewable energy that the Spanish government is poised to make risk causing bankruptcy in the entire renewable energy industry. Such was the warning issued by a group of 13 international investors – including HgCapital, Impax Asset Management and KKR – in a letter sent to the Commissioner for Energy, Günther Oettinger, and to Spanish and British Prime Ministers Mariano Rajoy and David Cameron.
The investors claim that this new measure not only risks causing the bankruptcy of the sector, but would also send the wrong signal to foreign investors. In the letter addressed to Rajoy, the investors state that they reserve the right to bring proceedings against Spain, both under EU and Spanish law, and under the Energy Charter Treaty, which protects foreign investors.
The Commission has received the letter and is evaluating it for the moment, Oettinger’s spokesperson said. She recalled that the commissioner had already insisted a month ago that Spain needed to tackle the ‘tariff deficit’ by improving the cost-effectiveness of the electricity sector. The spokesperson added that the Commission recommends that Madrid model its reforms in the field of renewables on the best European practices. In any case, the spokesperson said that Spain must avoid taking sudden and retroactive measures, creating confusion among investors – ie those who create employment and growth in Europe.