New law opens door to more energy efficiency in communities of owners

The Spanish government recently approved a package of measures to increase energy efficiency in residential properties. In addition, the new law contemplates a change in the current regulations for communities of owners to allow them to improve their energy consumption and to facilitate access to credit lines. 

Main objectives of new measures

Spain is in the process of receiving millions of euros in funds from the European Union. One of the main sectors to benefit from these funds is energy generally and renewable energy sources, in particular. 

The Spanish government is seeking to make it easier for communities of owners to carry out work in communal areas to increase the energy efficiency of their homes. The change in legislation means that communities of owners may now legally do the work and get finance to help pay for it.

Conditions for carrying out the work

The work must improve the building’s energy efficiency or install renewable energy sources for communal use. For the former, the emphasis will be on insulating the building and for the latter, putting up solar panels or similar to reduce the community of owners’ electricity bills. 

To qualify for financial help, the reduction in energy use by non-renewable sources must be at least 30%. And the greater the saving in electricity, the more financial aid the community may receive with the final amount between 40 and 80% of the installation costs. 

Get your free guide to buying property in Spain. 

Changes in community of owners’ regulations

To facilitate the installation of energy-efficiency measures, the legislation has had to make slight modifications to the regulations governing communities of owners. In the first place, the work may take place if a simple majority (half plus 1) of owners agree to it. This majority must also represent a majority of the share in the community. 

The new law also regulates the total cost of the work for the owners. It may not exceed nine months of community fees per owner after subtracting the grants and subsidies provided for the work. 

In turn, the installation costs are included in “general expenses” in the community of owners accounts.

Read about energy-efficiency certificates for properties in Spain.

Changes in financing

Previously, communities of owners have had difficulty accessing finance and credit lines because of their legal status. In addition, banks have traditionally been reluctant to lend to communities of owners because, in the case of default in payment, they would have to pursue each owner individually for the debt. 

The government plans to change the situation by making the community of owners responsible for the debt. This shift means that the community, not the bank, would have to go after each owner in case of default. 

The aim is to allow communities of owners to access public credit lines, known as ICO in Spain. ICO loans currently have €1.1 billion earmarked for energy-efficiency improvements in buildings. 

Your next step

Like to help the environment and save on your electricity bill? Get in touch for expert advice on access to the ICO funding for your community of owners.

Maria Luisa Castro

Director and Founder
María founded CostaLuz Lawyers in 2006 and is the Firm’s Director. María is registered Lawyer number 2745 of the Cadiz Bar Association and is licensed to practice in all areas of law throughout Spain. Working closely with her team, María has developed the firm into one of the most highly regarded and trusted Spanish Law Firms acting for English-speaking clients with legal problems in Spain. We’re here to help. Contact us today for a free no-obligation consultation.
 

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