Tuesday, May 7, 2013

Verde con enojo

Spain's small investors smell a rat; their government, which enticed many of them to invest their money in green energy.  Now they know the cost of politicians good intentions:

- Small investors put their money into solar panels after the then Socialist government of Prime Minister José Luis Rodríguez Zapatero issued a decree in 2007 setting up a system of fixed prices to compensate for the initial costs of setting up photovoltaic power plants.
- The first cuts to the subsidies came in 2010. Another decree limited the return on the installations to 25 years. Until then, the fixed price tariff was for the useful life of the plant. Also in 2010, another decree imposed a 7-percent tax on electricity generation.
- In that same year, a further rule change cut the number of hours of power generation eligible for subsidies.
- In 2013, another government decree froze the indexation of inflation in payments to the sector.
Which resulted in bankruptcy for many who were counting on the subsidies to repay loans they took out, often pledging their homes as collateral, to raise the funds for their investments.

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