Subsidy reductions
In the wake of the
2008 financial crisis, the Spanish government drastically cut its subsidies for solar power and capped future increases in capacity at 500 MW per year, with effects upon the industry worldwide. "The solar industry in 2009 has been undermined by [a] collapse in demand due to the decision by Spain," according to Henning Wicht, a solar-power analyst.
[6] In 2010, the Spanish government went further, retroactively cutting subsidies for existing solar projects, aiming to save several billion euro it owed.
[3][14] According to the Photovoltaic Industry Association, several hundred photovoltaic plant operators may face bankruptcy.
[15] Phil Dominy of
Ernst & Young, comparing the feed-in tariff reductions in
Germany and
Italy, said "Spain stands out as an example of how not to do it."
[16] As a result, a Spanish association of solar power producers has announced its intention to go to court over the government’s plans to cap solar subsidies.
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