29 Jul The great green opportunity of the European funds

Renewable or non-polluting energy will concentrate an important stake of the resources that the governments of the European Union have agreed to face the crisis caused by the COVID-19 pandemic.
We still do not know what percentage of the 750,000 million approved for the recovery plan and the 1,074 billion euros of the budget for the next seven years will be used to fight climate change through an improvement in energy infrastructure and efficiency programs. This percentage will depend on the projects that the countries bid to access direct aid and financing.
Spain will receive 140,000 million euros, ten times the amount of cohesion funds that allowed the country to catch up with its European partners in the 90’s. Of this amount, 72,700 will be direct aid, that is, they will not have to be repaid, and the rest will be received as loans. The President of the Government of Spain, Pedro Sánchez, has announced that he will implement “the National Plan for Reforms, a plan of investments to a growing, green, digital and inclusive transformation, also pouring economic resources into science, vocational training and into education”.
The country has a great opportunity to advance in the energy transition, a true bridgehead for the decarbonisation of the economy, essential to curb climate change. Spain has the necessary resources to take advantage of this great opportunity: renewable sources, mainly solar and wind; the technology necessary to build a more efficient generation park; the knowledge accumulated from the first years of the renewable energy boom; and the essential financial resources to make the projects a reality.
The main obstacle – and almost the only – that the industry faces is the regulation. As Juan Béjar, president of Bruc Management, recently wrote in El Confidencial, the regulation has to solve two major disincentives: “The first is the slowness in the process of deploying networks and interconnection points and obtainment of the different permissions, a situation that has worsened in the last three years. The second and deepest is price. The fall in demand caused by the pandemic, together with the existing pricing system, have caused a drop in the remuneration of the generation of more than 50%. An extraordinary fall that, as a matter of fact, has not benefited the final consumers, trapped by a complex system of tariffs, powers and tolls, but has however remained in the pockets of the large marketers ”.
Given the great opportunity presented by European funds and the draft bill on Climate Change and Energy Transition, the Spanish regulator must hurry to convert these disincentives into incentives that promote the solid advance of green energy and, as a direct consequence, employment creation.