The Government extends the Iberian limit to gas cogeneration plants

President Pedro Sánchez makes a move to guarantee employment in large industry.

Thomas Osborne
Thomas Osborne
06 September 2022 Tuesday 23:34
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The Government extends the Iberian limit to gas cogeneration plants

President Pedro Sánchez makes a move to guarantee employment in large industry. The Government is finalizing a ministerial order so that power gas cogeneration plants can take advantage of the Iberian mechanism and reduce their bill. An announcement that the president reserved for the energy debate that confronted Alberto Núñez Feijóo.

The Government responds to a request from business sectors such as ceramics, bricks, chemicals, paper mills, textiles or fertilizers, among others, which contribute 20% of industrial GDP. Sectors, key for territories such as Catalonia, the Basque Country or the Valencian Community.

The Executive considers that the expansion of the Iberian mechanism to cogeneration plants could even increase gas savings, according to calculations by the Ministry, around 10%. Sánchez estimated the reduction in energy consumption at this time at 4.6% since the savings plan was approved, still far from the 7% included in the European commitment.

There are currently stopped cogeneration plants due to the increase in the gas bill, which has reduced the electricity production of these facilities by 60%. The Government says that by benefiting from the Iberian mechanism they will be able to resume their operations and provide savings of up to 1.2% of the daily demand for gas.

Cogeneration, which has produced up to the current situation around 10% of the country's electricity, received a regulated remuneration of 665 million in 2021. The objective is that, after the legal change, it exceeds 1,000 million.

The Third Vice Presidency is finalizing the energy contingency plan committed to with Brussels. Sánchez referred to it stating that it will not contain "dramatic measures" such as "blackouts" or "rationing". He believes they won't be needed even if Putin turns off the gas tap.

Feijóo, for his part, proposed offering aid to companies and families that save energy, "instead of sanctioning them." The leader of the PP will send the Government an energy plan with 59 sections, among which he highlighted prolonging tax cuts until the end of the year and a firm commitment to renewables and all energy sources, including nuclear ones.