The Industry Ministry said a new energy saving plan for 2008-12 should produce a saving in primary energy usage of the equivalent of 88 million tonnes of oil for the five years together.

That represents 60 percent of Spain's total primary energy consumption last year and implies a reduction of 238 million tonnes of carbon dioxide (CO2), the main element of the greenhouse gases widely believed to be causing climate change.

Most of those savings have to come from transport, followed by agriculture, construction and the energy industry.

There is also funding for urban transport policies and for studies and pilot projects to improve company and public transport.

Other measures will look for ways to encourage companies to send more freight by rail or sea instead of by road.

Friday's measures involve additional funding of almost 500 million euros (US$690 million), which will build on an existing energy efficiency plan to take the total to 2.4 billion euros.

The Industry Ministry says the energy savings involved will be worth more than three times the cost of the plan by 2017.

The Environment Ministry produced a parallel package of initiatives including banning coal fired heating from 2012 and phasing out inefficient boilers.

Spain has ratified the Kyoto protocol to curb global warming, which is based on most rich nations reducing their emissions. However its CO2 output in 2006 was 48 percent above the 1990 level, while its target is to keep the increase at 15 percent.

The trade union CCOO, which along with environmental group Worldwatch produces the most up-to-date estimates of Spain's CO2 emissions, says emissions from transport grew 83 percent between 1990 and 2006.

"If it's confirmed that this plan includes most of the measures we environmental groups have been asking for, it will be good news because Spain would finally have a coordinated policy to tackle climate change," CCOO environment secretary Joaquin Nieto told Reuters.