Spain approves energy saving measures to offset oil hike

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Spain's cabinet on Friday approved 20 energy-saving measures, including a lower speed limit, to reduce the country's fuel consumption in response to the spike in oil prices due to unrest in the Arab world.

The measures will reduce oil imports by five percent, saving the country 2.3 billion euros ($3.2 billion) annually at current prices, the industry ministry said in a statement after the plan was approved by cabinet.

The new speed limit for highways will be 110 kilometres (68 miles) per hour, instead of the current limit of 120 kph.

The reduced speed limit, first announced last week, will come into effect on Monday and will remain in place until June 30. It may be extended beyond that date if needed.

Other measures include price cuts on commuter and medium-haul trains, greater use of low-consumption light bulbs to illuminate streets and roads, and subsidies for energy-efficient tyres.

The government will subsidize the purchase of 240,000 tyres designed to cut down on fuel consumption, which will benefit at least 60,000 vehicles, at a total cost of 4.8 million euros.

Other changes include increasing the amount of bio-fuel which oil companies are required to include in all diesel and gasoline will be hiked to 7.0 from the current mandatory 5.8 percent.

Spain depends on imports for 75 percent of the energy it consumes, compared to an average of 60 percent for the entire European Union.

Each increase of 10 euros in the cost of a barrel of oil adds some six billion euros to Spain's annual energy bill, according to the government.

© 2011 AFP

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