Spanish renewable energy shares rose Monday after the government and part of the industry announced Friday an agreement on the new rules that will be applied in coming years to wind- and solar thermal-generated energy technologies.

At 1350 GMT, Abengoa SA (ABG.MC) shares were up EUR1.45, or 8.8%, at EUR17.96, while Iberdrola Renovables SA (ABG.MC) shares were up EUR0.12, or 4.6%, at EUR2.73 and Acciona SA (ANA.MC) shares were up EUR3.63, or 5.9%, at EUR65.6.

The agreement announced late Friday covers the years through 2013 and removes doubts about the regulatory framework for the wind- and solar thermal-energy industries after months of uncertainty. In the case of wind energy, the Wind Energy Association and the government have agreed, among other things, to reduce the subsidies that wind parks receive by 35% over the next three years.

"The pact eliminates the regulatory insecurity for the sector," Iberdrola Renovables said in a note. "In addition, it provides stability regarding future revenue with reasonable rates for the sector."

The new regulations will have an "immaterial financial impact" on Iberdrola Renovables, the world's biggest wind-energy producer, analysts at Barclays Capital said Monday.

The new rules will cut the company's earnings before interest, taxes and amortization, or Ebitda, by less than EUR10 million a year from this year through 2020, Barclays said.

The reduction of wind-energy subsidies will be applied to projects that were commissioned after the end of 2007 and through the end of 2012. In addition, the government plans to limit the number of subsidized production hours to 2350 hours a year, though it is unusual for a wind-energy park to reach that limit.

"The agreement permits companies to earn a reasonable profit for their investments, between 8% and 9%," said Antonio Cruz, an analyst at Banesto, in a note.

In the case of the solar thermal sector, which includes companies such as Abengoa and Acciona, the government has agreed with Protermosolar that all the existing and future power stations will during their first year of operation charge a lower, regulated rate than the one currently charged.

Luis Crespo, secretary general of Protermosolar, estimated the new rate will reduce solar thermal subsidies by around EUR1 billion through 2013.

The photovoltaic energy sector is still negotiating its regulatory framework with the government.

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