Spanish wind industry warns EU windfall tax could hurt investment

MADRID, April 6 (Reuters) - Spain's wind industry association AEE warned on Monday that a proposed windfall tax on energy firms' profits could curb investment in renewable energy just as Europe seeks to cut its reliance on fossil fuels.

The criticism came after five EU countries, including Spain, put forward the proposal to tax excess profits earned amid energy price hikes triggered by the Iran war.

Reuters exclusively reported on Saturday that the finance ministers of Germany, Italy, Spain, Portugal and Austria jointly called for an EU-wide tax in a letter to the European Commission, saying the measure could help fund relief for consumers hit by high energy prices.

According to the AEE, renewable energy, particularly wind, has proven to be the most effective mechanism for keeping prices in check in Spain, one of Europe's leaders in the use of eolic power.

"Proposing new potential taxes that affect the electricity sector creates legal uncertainty and deters investors, precisely at a time when it is more necessary than ever to invest in technologies such as wind power as a substitute for imported fossil fuels," it said in a statement.

The AEE has more than 350 members including power utilities Iberdrola IBE.MC, Endesa ELE.MC, Acciona ANA.MC, Portugal's energy firm Galp GALP.LS, as well as developers, wind turbine manufacturers, consultants, financial institutions and insurers.