Electricity sector regulation (Electricity Law 24/2013)

Source: JOIN IEA/IRENA Policy and Measures Database
Last updated: 19 July 2018

Law 24/2013, of the electricity sector was approved on 26 December 2013, and entries into force on 28 December 2013, replacing the Law 54/1997. It sets up the principle of financial and economic sustainability: the system revenues have to cover all the system costs. Regarding renewable energies, it supersedes the existing special regime for electricity producers, maintaining the fundamental principle of previous supporting schemes: a reasonable return.

The provisions contained in Royal Decree-Law 9/2013, of July 12, 2013 have basically been included for the calculation of the for electricity generation using renewable energy sources, high-efficiency cogeneration and waste to energy plants.

Remuneration of renewable energies, high-efficiency CHP and waste to energy facilities, will be based on the necessary participation in the market by these facilities, and will supplement the market revenues with a specific regulated subsidy that will enable these technologies to compete on an equal footing with other technologies in the market. This specific subsidy will be sufficient to attain the minimum level required to cover the investment and operating costs that these technologies cannot recover in the market and may enable them to obtain a suitable return.

In the systems of the no-mainland territories, it can be added an incentive for investment and completion within a given period where the facility entails a significant cost reduction. The subsidy parameter review criteria will be set taking into account the cyclical situation of the economy, electricity demand and appropriate profitability of these activities. It also establishes that the allocation of these subsidies to new facilities should be established through competitive tendering procedures It rules hydroelectric authorizations as well. Even though the producers of electricity using renewable sources, and high efficiency cogeneration will continue to have preference for access and connection to the grid, the electricity coming from these facilities will only have preference for being dispatched under equal economic conditions in the market. 

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