Today there is a great appetite in the market for developers and investors, both national and foreign, to develop and build wind and PV assets in Spain.

Evidence of this can be found in the immense amount of access and connection permissions approved for these two technologies, far exceeding the government´s NECP installed capacity targets for 2030. Targets that, according to EKON consultancy, are overestimated since in the case of PV, they are calculated using 1,791 hours of annual operation, a historical data well below the current performance of newly developed assets.

The interest in developing wind and PV in Spain has peaked ever since these technologies reached grid-parity. In this context, why is the government planning on holding auctions? Renewable energy auctions in Spain would be necessary if the market is sending signals that the necessary capacity is not going to be installed in time to achieve the NECP targets.

Furthermore, who is going to buy that energy? Could Last Resort Suppliers buy it as it has been done in auctions in Portugal? This would pose two problems: (1) the current regulated price system (PVPC) would have to be modified to prevent Last Resort Suppliers from having unfair and illegitimate wind fall profits and (2) it would conflict with the spirit of suppressing regulated prices from Directive (EU) 2019/944 of the European Parliament and the European Council.

IBERIAN ELECTRICITY MARKET REPORT – SOLAR PV & WIND are now available. Click here to Download Report Brochure