Spain to offer $215 million in renewable energy subsidies

FILE PHOTO: Wind turbines are seen near the Andasol solar power station near Guadix, southern Spain August 10, 2015. REUTERS/Marcelo del Pozo

MADRID (Reuters) - Spain will inject 181 million euros ($215 million) of state funds into renewable energy projects in seven regions, aiming to boost employment and cut carbon emissions, its Energy and Environment Ministry said on Thursday.

The subsidies are part of a chest of 316 million euros Madrid will pour into innovative projects - an amount that could be topped up with EU recovery funds.

Rich in high-energy sunlight, Spain is a vocal supporter of European Union plans to use low-carbon investments to battle the economic devastation wrought by the coronavirus, particularly on its traditionally strong tourism and automotive industries.

Projects that could benefit from the subsidies include those generating power from sunlight, wind, biomass, and renewable gases including hydrogen in sectors including agriculture, industry and services, the ministry said in a statement.

Prime Minister Pedro Sanchez’s government expects its carbon-reduction plans to require 200 billion euros ($227 billion) of total investment in the next decade, 47 billion of which Sanchez has said would come from the public sector.

The funds unveiled on Thursday should encourage a further investment of 551 million euros from the private sector and cut greenhouse gas emissions by 712,000 tonnes of carbon dioxide equivalent each year, the ministry calculates.

Decisions on which projects receive the funds will take into account demographic challenges and the welfare of workers in regions affected by the shift to renewable energy.

($1 = 0.8422 euros)

Reporting by Isla Binnie, Editing by Inti Landauro and Elaine Hardcastle