Montel Online 22.03.2022
Spain could speed up its renewables push amid European plans to reduce energy dependence on Russia, and it could install 7-8 GW every year if permitting is streamlined, experts said.
«Could we install 7-8 GW per year? Yes, as projects do exist. If [permitting] processes are streamlined, it can speed up a bit more,” said an analyst at credit rating agency Fitch Ratings.
The figure is higher than the 5-6 GW of new green capacity per year envisioned in the Spanish energy and climate plan, which eyes at least 3-4 GW a year in renewable auctions until 2025.
The analyst noted that the war in Ukraine could be an opportunity to speed up projects and prevent large utilities from focusing their renewable activities on other countries.
«If we want to cope without Russian gas, we must accelerate as soon as possible» the construction of renewables capacity, agreed David Perez Lopez, energy business unit director at consultancy firm Capgemini. Russia typically is Europe’s largest gas supplier, providing about 40% of its needs.
“Delays [in permitting] are the biggest bottleneck,” said Ana Barillas, director of Aurora Energy Research for Spain, although she also pointed to other obstacles such as regulatory uncertainty.
The Spanish government has proposed market interventions to tackle spiralling energy costs ahead of the European Council meeting scheduled for Thursday and Friday.
More renewable auctions would help speed up green capacity construction, but there was already enough investor appetite with no need for tenders, experts said.
PPAs to play role
“Most of the renewable growth is going to come from PPAs [power purchase agreements] and merchant,” said Fitch’s analyst, pointing to higher profitability for green assets in the current high-price context. The merchant option generally does not include a PPA or auction contract and trades on the market.
Meanwhile, there was «some disconnection» between the country’s climate goals and the pace of construction, the analyst added. Solar growth in Spain seems to be in line with expectations, but the pace of new wind capacity installation lags, experts said.
“We believe that much more solar than wind capacity is going to be installed,” agreed Javier Revuelta, Afry’s principal consultant in Spain.
Spain would reach some 50 GW of solar capacity – including 10 GW of self-consumption – by 2030, and only 35 GW of wind turbines, Revuelta said. This contrasts with the Spanish goal of reaching 39 GW of solar and 50 GW of wind capacity by 2030.