Energy, in Spain the cost goes below zero. Thanks to renewables

Energy, in Spain the cost goes below zero.  Thanks to renewables

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Anyone who thinks that renewables cost more than energy from fossil sources will have to think again. The news comes from Spain and says a lot: yesterday the country enjoyed a few hours with negative energy prices, thanks to renewable sources. Thanks to the disruptions of the last few days, in fact, the production of wind and hydroelectric they exploded in the Iberian country. Between 1pm and 4pm on Easter Monday, electricity cost -0.01 euros. The same situation had already occurred last March when Spanish operators were able to buy wholesale electricity for zero euros. In fact, it has hit Spain in recent days Cyclone Nelson with storms and gusts of wind up to 100 kilometers per hour which maximized energy production in the numerous wind farms.

This situation, however, is not reflected in a necessary vertical decrease in the price of bills for consumers: given what happened, VAT on electricity was immediately raised from 10 to 21%.

According to what the newspaper reports El Pais, the government had announced that it wanted to keep VAT on electricity at 10%. The government had reduced VAT on electricity from 21% to 10% in June 2021, at the start of the turbulence related to the energy crisis. A year later, during the Russian offensive in Ukraine, VAT was reduced again from 10% to 5%. Now we are taking the opposite path.

The Spanish record

Eurostat data show that Spain is one of the most virtuous European countries when it comes to energy production from renewable sources. In 2022 it was seventh for the increase in the proportion of final energy consumption from renewable sourceswith seven percentage points more than in 2021.

According to a forecast by the energy consultancy firm Rystad Energy, today the country is on track to be the first European country capable of generating more than 50% of its national energy needs from renewable sources. The nation was among the first to embrace onshore wind power, a technology that now makes up more than 20% of electricity production in Spain. Furthermore, substantial investments in the solar photovoltaic sector have significantly expanded the capacity and production of green energy in recent years. Hydroelectricity, previously the country’s main renewable energy source, now contributes approximately 10% of Spain’s total energy production.

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