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Spanish coal decree to kick in on 25 February

23 Feb 2011 18:14:48 | edem

Spain's new coal law will finally be implemented on 24 February and start to have an effect from 25 February, according to a statement from the country's industry ministry.

When it does start, the ten coal-fired power stations in Spain that are affected will have the obligation to burn domestically sourced coal, for which they will be paid a set rate on a €/MWh basis.

The law was created by decree last year, but has been hotly contested both in the Spanish appeal courts and in Europe.

A ministerial statement was issued last week, but a spokesman on Tuesday confirmed that 25 February was still the planned launch date. He admitted, however, that the start of implementation "could vary by a couple of days depending on the state of the coal-fired power stations".

The ministry's statement was issued following the final rejection on 17 February by the EU's General Court in Luxembourg, against a ruling by the Autonomous Region of Galicia.

Electricity companies Endesa, Iberdrola and Gas Natural Fenosa had already abandoned their appeals (see EDEM 4 February 2011).

"The opinion of the Luxembourg court completely removes the barriers that prevented the application of the Coal Royal Decree," the ministry statement read.

This follows the publication on 10 February in the Spanish state bulletin of rules governing how much domestically produced coal can actually be burnt.

The government has capped the ten Spanish coal plants that will burn domestic coal in support of the domestic coal industry at the following levels, along with the price they will receive on a €/MWh basis:

n Soto de Ribera 3; 1,312GWh

(€88.47/MWh, $121.14/MWh)

n Narcea 3; 1,206GWh (€82.35/MWh)

n Anllares; 1,968GWh (€70.16/MWh)

n La Robla 2; 2,035GWh (€71.46/MWh)

n Compostilla; 5,444GWh (€69.86/MWh)

n Teruel; 6, 1,84GWh (€63.60/MWh)

n Guardo 2; 1,943GWh (€76.35/MWh)

n Puentenuevo 3; 1,482GWh (€99.94/MWh)

n Escucha; 372GWh (€72.42/MWh)

n Elcogás; 1,400GWh (€98.68/MWh)

Spanish power traders are scornful of the new law, which they say distorts competition and risks damaging the market's credibility.

The new law has also drawn strong criticism from both the gas lobby and green activists. RS

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