Czech follows Spain in deciding to tax output from solar power

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Czech Republic joins Spain in effort to curb solar growth, as Senate approves plans to extend 10% solar tax and cut renewable energy subsidies.

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The Czech Senate has approved controversial new laws to end subsidies for renewable energy and to extend a tax levied on solar power plants in a vote on Friday. PVTech reports that the motion – proposed in reaction to inflated consumer energy prices – was successfully passed in the lower house of parliament in mid-August, and was widely expected to pass the upper house.

It means that renewable energy facilities switching on after December 31, 2013, will not receive the feed-in tariff or any other subsidy payments, but  owners of solar power plants installed after 2010 will have to pay a 10 per cent tax for the full life of each power station. The law will also exclude small and residential systems under 30kW – the most recent  recipients of state-supported PV installation.

The new laws – which fail to make any provision for net metering for self-consumption – have been vocally opposed by the Czech solar industry, which argues that rising power prices are a consequence of FiT rate mismanagement, rather than the fault of the solar industry. The changes must now gain approval from Czech president Milos Zeman before they are ratified.

The move to stem solar growth follows that of the Spanish government, which in July announced a “support levy” on solar power as part of a series of new taxes on green energy. The levy, passed in August, effectively charges a fee – 6 Euro cents per kilowatt-hour – for electricity generated by grid-connected solar panels or other renewable sources and used on-site.

“Charging a fee for generating your own energy sounds absurd,” admitted BNEF’s head of solar analysis, Jenny Chase, last month. “But in the long term, passing a higher proportion of the cost of running the grid to low-income customers is also unpalatable,” she said. “Compromises will need to be made on this issue in more countries than just Spain.”

Indeed, like the proposed Czech solar tax, Spain’s solar levy aims to help fund a €26 billion debt to power producers which, built up over the years through regulating energy costs and prices.

As Bloomberg reported, the levy makes self-generated solar power more costly than electricity bought from the grid, “rendering such systems uneconomical” – a fact one Madrid architect has since attested to, having removed his own rooftop PV panels after only six months of use, when it became clear that the cost of generating his own clean energy no longer added up.

“Neither was it possible to leave the panels on his Madrid home without connecting them to the electricity grid,” reported Reuters; “that would have risked an astronomical fine of between €6 million and €30 million.”

Spain’s Industry Ministry, whose July power reforms included income limits for clean-energy plants, said the new levy was needed because grid-connected solar energy consumers also benefitted from the back-up provided by the power system, reports Bloomberg. It was also aimed at controlling growth in rooftop solar, the government arguing that Spain already has too much generation, since total capacity exceeds peak demand by more than 60 per cent.

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9 Comments
  1. Albert Sjoberg 5 years ago

    Be afraid, Be very afraid.
    The arguments for this tax are completely ludicrous.

    “Consumers benefit from the back-up provided by the power systems.”
    That is like taxing the consumer if he does not consume a certain minimum threshold of power each cycle.

    This current government with decidedly anti-renewables values need to be kept in check with a strong opposition.

  2. disqus_tObYqppPWg 5 years ago

    This is the only way to stop the tide of overpriced solar. Less costly alternatives are the answer. Modern scrubbers and filters allow even fossil fuels to burn cleanly. Stop the scam. Overpriced, inefficient energy is what you need to be afraid of. If they want, allow them to supply the grid at a reduced price. That will help the poor.

    • Andrew Thaler 5 years ago

      How about allowing them to supply the grid at Parity… or is that idea too scary for you as we can now provide Solar PV at a parity price and still make a small economic return.
      Just who is perpetuating the scams?

      • disqus_tObYqppPWg 5 years ago

        The Lobbyists that push the government to pay outrageous prices for energy that could be purchased at a better price. If you can compete without special favours, I all for it. But that hasn’t been the case up till now.

        • Biff 5 years ago

          How about the long and well-documented history of subsidies for the fossil fuel industry? In the USA, oil and gas received approximately US$4.8B in annual subsidies between 1918-2009 (source: DBL Investors http://i.bnet.com/blogs/dbl_energy_subsidies_paper.pdf). Renewables? US$400M a year between 1994-2009. Or how about the ‘temporary’ tax break passed in 1950 and designed to help fund the Korean War? It’s still running today. In Australia, how about the fuel subsidies paid to the likes of Macquarie Generation that runs to hundreds of millions of dollars annually. You’re a mug if you think that ‘special favours’ don’t apply to fossil fuels.

          • disqus_tObYqppPWg 5 years ago

            They are efficient, and reliable. I don’t mind paying for a viable product.

          • Biff 5 years ago

            Well, you’ve just sidestepped your own assertion about special favours. Do you know anything about innovation and the benefits of incumbency? There is an efficient and reliable fossil fuel system in place but it only got there through heavy and continuing subsidisation. Solar PV is extremely reliable and the pricing is moving towards parity, also with subsidisation (but not for ever). Don’t forget, we’re not doing this because it was cheap, we’re doing it because our best scientists told us there was a problem with emissions from fossil fuels so ‘cheap’ is not the only consideration any more.

  3. Andrew Thaler 5 years ago

    Coming soon to an Australian (Liberal Government mandated) community…???

  4. LeeVonHart 5 years ago

    The same is happening in States re: storm water management via rain taxes, Counties/townships have pension debt and need revenue.

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