Page 84 - Economic report 2020

that employment in the sector fell 13% between 2013-2016. Currently, the sector’s share of
employment is similar to that of the food and beverage industries, at around 14%.

Electricity production and distribution is the fourth most important subsector in terms of
employment – after the tobacco, food and beverages industry, and printing and graphic arts. In
2022, it represented 9.7% of total employees, with a slight positive variation (+1.7%).

In 2022, national electricity production (calculated in 110 kV busbars) saw a year-on-year decrease
of 4.5%. This decline can be explained by the major drop in hydroelectric power generation
(-13.4%), the lowest figure since 2008. On the
Electricity production fell 4.5% due to other hand, solar energy production increased
lower hydroelectric power generation, 216%, reaching the highest figure in the
but solar power reached a historic high. historical series. Thermal power generation
increased more moderately, by 1.7%. Despite
these trends, only hydroelectric power is
relatively important as an energy source, as it represents 12.4% of the total energy demand in the
Principality; thermal power represents only 4.4% and solar power 1.4%.

Box 10.1
ENVIRONMENTAL LEGISLATION

In the legal field, Law 21/2018, of 13 September, on to the national electricity network. Remember that
the Energy Transition and Climate Change (Litecc), Law 21/2018 on the Energy Transition and Climate
82 establishes the bases for the future of energy in Change sets the goal for national production to cover
Andorra and defines climate change goals. More at least 33% of demand and for the percentage to
recently, on 23 January 2020, the General Council reach 50% by 2050. New infrastructures will help to
passed a resolution recognising the climate crisis achieve the goal, such as construction of the wind farm
and declaring a state of climate and environmental that FEDA is studying and installation of solar panels
emergency, entrusting the Government with various on privately-owned land and roofs, an investment that
relevant actions. has increased exponentially thanks to the grants and
subsidies in the Renova Plan.
In response to the commitments and the above-
mentioned law, the 2020-2050 National Energy As for taxation, the amendment of the Law on special
Strategy to combat climate change was passed in taxes passed in July 2021 set the date for application
Andorran economy: developments in the main sectors | X. Industry
February 2021, the roadmap for Andorra to tackle of the green tax for 1 January 2022. The green tax
climate change and increase the country’s resilience is a targeted tax form intended to reduce, mitigate
to its impacts. As for emissions, its goal is carbon and repair the effects of CO emissions. The revenue
2
neutrality by 2050, and to achieve this target, the will be destined for financing a green fund to make
strategy also sets the reduction of the carbon public transport accessible to everyone and improve
footprint in the sectors that emit these gases in home comfort. The green tax is indirect by nature
this country. and imposed on imports of hydrocarbons. Moreover,
within the context of the major increase in fuel prices
With this goal in mind, in January 2022, the Government in 2022, temporary partial reductions of the special
passed the regulations on electricity production hydrocarbon tax were approved for some types
through government concessions, to streamline the of vehicle.
granting of concessions to stakeholders in the sector
to incentivise the installation of hydroelectric and solar For housing, the Law on the Energy Transition and
power plants. These regulations allow the construction Climate Change establishes that from 2020, new-builds
and exploitation, by the private sector, of electricity must have virtually zero energy consumption, obliging
generating plants using renewable sources connected buildings to be well insulated and weatherproofed.