Impact of the Reform of the Spanish Support Scheme for Renewables on the Revenue of Photovoltaic Power Plants

In this paper, we study the impact of the 2013 reform of the Spanish support scheme for renewable on the revenues of photovoltaic plants. We break down the revenue change into two sources. The first lies in the difference between the payment per unit of electricity that the plant received under the new scheme, and what it would have received under the original scheme. We show that this change depended on plant productivity. The second lies in the revenue forecast errors made by investors when evaluating investment projects. These errors can explain part of the liquidity problems claimed by investors