Government Reverses Course on Nuclear Waste Tax Increase

Government Retreat Changes Course on Nuclear Waste Tax Increase

The government has rolled back and halted the legal process it had launched to apply a steep almost 40% rise in the tax paid by nuclear power plants. The funds would have covered the multimillion-dollar costs of dismantling reactors, building seven nuclear waste facilities, and managing radioactive materials for decades.

The announced increase had provoked a fierce response from the major electricity companies that own the plants — Endesa, Iberdrola, Naturgy, and EDP — which filed strong objections and launched a legal battle in the Supreme Court against the new General Plan for Radioactive Waste (PGRR) approved by the administration, and against the decision to close the door on the Villar de Cañas facility in Cuenca.

The Ministry for Ecological Transition, led by Vice President Teresa Ribera, decided to pause the process to apply the 39.5% rise in the Enresa levy and to archive the proposed real decree that would have raised the charge on nuclear plants. It will start a fresh process without pre-committing to any specific increase, according to official government sources and multiple players in the energy sector.

The government has effectively ended the public consultation on the drafted decree and opened a new stage of pre-consultation so the sector can weigh in on how to legislate the necessary uplift, without outlining an amount in advance. “The Ministry for Ecological Transition restarts the transmission of the project to update the public patrimony payment that funds Enresa’s service to nuclear plants, launching a new public pre-consultation, following the same procedure used in 2019 when the update was last processed,” explained ministry officials to this outlet.Source: Government communications

The previous public consultation expired on February 2, but the government granted extra time for the nuclear industry association Foro Nuclear — which includes the major utilities — until February 26. Now Madrid restarts the process from scratch, this time a pre-consultation that does not assume the magnitude of any increase, and the sector and other interested parties can submit observations by March 18 on how much to raise Enresa’s charge. The ministry acknowledges that many objections from the earlier round requested more time.

180 Million Euros a Year At Stake

The Ministry had activated the process in January to approve a raise in the payment the companies owe, reaching 11.14 euros per megawatt hour (MWh) of electricity produced by the nuclear plants, a 39.5% increase over the current 7.98 euros per MWh.

These plants owe Enresa a non-tax public patrimony payment based on the electricity they generate. In total, depending on annual output, the owners of the plants — led by Endesa and Iberdrola, with residual stakes by Naturgy and EDP — pay around 450 million euros per year into the fund that finances the nuclear waste plan, which currently holds roughly 7.4 billion euros in reserves.

The proposed rise would lift the annual payments by the time the new plan is fully in effect to about 630 million euros, an increase of 180 million euros, triggering a direct clash between the government and the major utilities, which have long contended that the existing taxation endangers their financial viability.

The nuclear companies argued that all taxes and charges already push about 25 euros per MWh toward their costs (roughly 35–40% of plant income). With the Enresa levy rising, they expected to pay around 28 euros per MWh (nearly half of total revenue). A PwC report projected that total payments could climb to about 1,566 million euros per year when taxes and the Enresa increase are combined.

The Bill Heading for Nuclear Shutdown

The ministry’s plan previously favored a 39.5% rate hike to cover over 2,000 million euros in new nuclear waste management costs that lay under the government’s plan. The 2019 update had included another near-20% rise. The proposed rate increase was tied to the new General Plan for Radioactive Waste (PGRR), approved in December by the Council of Ministers, which lays out a decades-spanning roadmap for closing and dismantling plants, managing remaining waste, and establishing the total cost to be funded.

The PGRR confirms a staggered shutdown of all Spanish nuclear plants between 2027 and 2035, a schedule agreed by the utilities and Enresa in 2019. It contemplates the construction of seven temporary waste stores at each plant for roughly five decades, followed by a large permanent repository planned for 2073. The plan pegs the total remaining cost at 20.2 billion euros for active plants.

Foro Nuclear, the sector’s trade group including Endesa, Iberdrola, Naturgy, and EDP, has filed appeals with the Supreme Court against the new PGRR and against the government’s decision to abandon the single-store concept at Villar de Cañas (Cuenca).

Electric companies argue that the new waste scheme and the end of the Villar de Cañas project are what push the government toward a 40% tax increase, and they dispute bearing the billions in additional costs that stem from political and institutional disagreements about where to locate a single temporary store rather than attributing the costs to the companies themselves.