IBERDROLA considers the National Assignment Plan 2008-2012 emission rights, approved by the Cabinet today to be a step in the right direction, although it is insufficient to reach the environmental targets set for Spain in the Kyoto protocol.
While awaiting the emission rights share by installations, the Company indicates that it is positive that the definitive National Assignment Plan has slightly improved assignments to combined cycle plants with respect to the draft presented this summer, but rejects most of the emission rights going to coal-fired plants, which are already amortised and emit more.
In this sense, IBERDROLA believes the share by generation technology considered not to be in line with the final goal sought: a reduction in emissions at the least possible cost. It therefore wonders why the new Plan for the 2008-2012 period awards almost 60% of the rights assigned to the electricity sector, including systems for non-peninsular Spain, to coal plants, which suppose only 40% of installed thermal power in the peninsular system susceptible to receiving emission rights.
The company has always advocated that the subsidy that the Plan represents should benefit investments in the best thermal generation technology available to reduce CO2 emissions – the combined cycles, as, otherwise it would be discouraging investment in the new plants needed to ensure supply in Spain and to meet environmental targets.
Although IBERDROLA advocates a nil assignment to the electricity sector because CO2 costs can be recovered from the market, the Company values very positively the Spanish Plan making a large part of the effort to reduce greenhouse effect gases fall on the shoulders of the other industrial sectors, by reducing the total assignments from 85.4 million tons of CO2 in the 2005-2007 period to 54 million for the period 2008-12 and that electricity companies must internalise the cost of CO2.
IBERDROLA, one of whose strategic pillars is the defence of the environment and its bid for sustainable development, has been the pioneer Spanish electricity company in defending the compliance of the targets set in Kyoto.
This commitment was illustrated in its Strategic Plan, focussed on starting up power stations using the cleanest generation technologies. In this way, in recent years it has gone from 0 to 9,800 MW managed through combined cycles, which only emit one third of the figure of coal-fired power stations and from 500 MW of renewable energy to 4,100 MW.
As a consequence, the greater electricity production via clean technologies has allowed IBERDROLA to reduce significantly its CO2 emissions to the atmosphere. Between January and September 2006, these reduced at Group level by 6.2%, from 269 grams of CO2 per kWh to 247 grams and in Spain by 14.9%, from 242 grams of CO2 per kWh to 206 grams, where emission free electricity generation has reached 62.1% of the total.
IBERDROLA recently became the only Spanish Electricity company and one of five worldwide included in the Climate Leadership Index, a new international recognition that illustrates its firm strategy for combating climate change.