Spanish Industry, Energy and Tourism minister José Manuel Soria on Friday announced a new system of financial returns for renewable installations based on a guaranteed "reasonable profitability" of such projects and fixed by the government at 7.5%.
The minister did not reveal how the latest cuts are going to be introduced, saying only that there will be a new system for renewable energy.
The Canary Islands and the Balearics will have a new renewables scheme. Soria explained that renewable energies are more cost effective than conventional energy in the Spanish islands.
The government claims the changes are backed by existing legislation of the electricity sector and previous rulings of the Supreme Court.
Cuts in the national renewables budget were announced along with further cutbacks in distribution and transport intended to save around 2.7 million and come on the back of previous reductions in FIT payments in 2012 and this year.
The Spanish government is trying to deal with a tariff deficit estimated at around 26 million.
The minister said energy reform will give certainty to the sector and confidence to the investors.
This is the fifth photovoltaic cut in Spain. The first was introduced in 2010 with the Real Decreto-Ley 14/2010 which put a limit on the number of hours funded by the feed-in tariff.
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