The head of utility giant Iberdrola has strongly urged the Spanish government to accelerate implementation of its new national climate and energy legislation to 2025 rather than 2030, in order to speed up a green economic recovery in the wake of the Covid-19 pandemic.

Ignacio Galan, Iberdrola’s chief executive, told the Spanish Confederation of Business Organisations summit, that electrification of the economy is key to recovery, as the sector delivers one of the greatest multiplier effects. “For every internal job generated in our sectors, 12 are generated in sectors such as construction, manufacturing, engineering and installation services.”

The Spanish government has approved the new climate and energy law – which still has to be approved by the Spanish parliament – which aims for 70% of the nation’s power to come renewables by 2030 on the way to a 100%-clean electricity system by 2050, up from about 50% now.

Galan said implementation of the national plan by 2025 “would have an immediate effect on economic growth and employment, increasing competitiveness, reducing our energy dependence on foreign countries, improving the balance of payments and reducing our harmful emissions, all without putting pressure on public finances”.

In renewables accelerating the installation of new capacity to 2025 “would mean an investment of €32bn ($36bn) and would quickly generate 90,000 jobs throughout the country, especially in rural areas”.

The Iberdrola chief also advocated increasing energy storage capacity, for bringing flexibility to the system. “An investment of €5bn in hydroelectric pumping and batteries until 2025 would create around 14,000 jobs,” said Galan.

He called for a “significant increase” in investments in electricity distribution networks in Spain which could generate up to 40,000 jobs. But, her said, for this to happen measures such as “the elimination of the maximum investment limit of 0.13% of GDP that we have in our legislation” must be adopted.

In the transport sector, bringing forward investments in infrastructure for recharging and electrifying urban bus fleets would mean an in investment of €5bn and create 14,000 jobs.

Galan urged Spain not to miss out on the development of new technologies, such as green hydrogen. “Decarbonising 25% of industrial hydrogen would mean investments of more than €4bn and the creation of 11,000 jobs in a new national industry.”

But to take advantage of these opportunities he said the Spanish government needed to urgently take a number of measures. Among these he called for a reorientation of taxation based on the principle of ‘the polluter pays’.

Galan has called for a “a complete rethink” of Europe’s energy taxation system so that the heaviest polluters pay the most under the new Green Deal, which aims to take the EU to net-zero-CO₂ emissions by 2050.

Transition

Speed-up climate plan by five years to boost economy post-Covid, Iberdrola chief tells Spain