Climate Change and Energy Transition Law: Towards Climate Neutrality

The Government of Spain presents to the Cortes the preliminary draft of the Law on Climate Change and Energy Transition, which aims to achieve emissions neutrality by 2050 as a limit

The preliminary draft of the Law on Climate Change and Energy Transition, whose aim is the decarbonization of the country’s economy and the gradual transition towards emissions neutrality, was presented on May 19 in the Cortes. This draft also comes in a context in which the scientific and technological sector sees climate action and sustainable recovery as one of the pillars of recovery from the economic crisis caused by the consequences of the Covid-19 pandemic.

This idea of ​​investing in decarbonization and the energy transition as a point of recovery from the Covid-19 crisis is something that the Ministry of Ecological Transition supports when speaking of a project that “in a context of economic reactivation in the face of COVID-19, positions Spain to take advantage of the opportunities opened up by the ecological transition in terms of modernizing the economy, new reindustrialization, job creation and attracting investment.” And according to the figures provided by the executive, this roadmap would attract more than 200 billion euros of investment over the next ten years, generating between 250,000 and 350,000 net jobs annually and increasing the country’s Gross Domestic Product by 1.8%.

The contribution of this regulatory framework to the country’s wealth becomes one of its main arguments. Something that emerges from the draft where it states that “in a country with high unemployment rates like Spain, it must be the driving force behind the creation of new, decent, quality jobs.”

Thus, the objectives for climate neutrality, which may be revised upwards, are set out in the following main points:

1. Climate neutrality by 2050.
2. A 100% renewable electricity system before the middle of the century.
3. A 20% reduction in emissions from the entire economy by 2030 Spanish.
4. Ensure that 35% of final energy consumption is from renewable sources by the end of the next decade; guaranteeing that 70% of the Spanish electricity system is renewable by 2030.
5. Energy efficiency measures will have to reduce primary energy consumption by at least 35%.

This bill emphasizes the need for an “attractive, predictable, and stable” regulatory framework to attract private sector investment. Thus, the Government indicates that these investments will materialize in the sectors of efficiency and savings, renewables, and electricity networks; with notable savings on fossil fuel imports, one of the pillars of Spain’s trade balance, starting in 2025.

The obligation to install electric vehicle charging points will cost the gas station sector at least €44 million

Within the Law on Climate Change and Energy Transition, one of the most interesting points for the future is the installation of the so-called “electrolineras”, which are essential to consolidate the electric vehicle. According to the newspaper Expansión, this law, which would affect 10% of the gas station network in Spain, would have a “minimum impact” of 44 million euros. According to the draft, the installation of each charging point would cost an average of €40,000, which would affect around 1,105 gas stations across the country.

This figure would have different impacts depending on the type of electrical installation required and the service offered to users. The measure establishes a minimum power of 50 kW (fast charging) in direct current. However, different points of 50 kW or higher power could be installed depending on the needs of each service station. An example of this would be super-fast charging stations, which would reach 100 kW and whose investment cost would be between €100,000 and €200,000. If 10% of service stations were to install this type of high-transmission charger, the impact of the sector’s investment would be €111 million.