Spain’s top wind industry body told Recharge key details are still missing as it gave a lukewarm reaction to the government announcing a 3.1GW resumption of renewables tendering, and revealed the sector hopes to see a separate scheme for offshore wind unveiled next year.

The new auction to be launched next month, which replaces a previous system introduced in 2013, will include 1GW of wind, 1GW of solar PV, and 80MW of biomass. The remainder of the planned capacity will be drawn from other clean energy technologies.

The ecological transition ministry has published a five-year auction calendar, to be updated annually, showing such details as the frequency of auctions, expected capacity and types of technologies. In a directive for public discussion it sets out a plan for annual auctions with the aim of awarding a total of around 19.4GW of capacity across all renewables technologies between 2020 and 2025.

“We are moderately satisfied. A lot of the details are still not known and it’s important to understand whether this new auction design will be able to mobilise all the wind projects needed in order to comply with the 2030 objectives in the Spanish National Energy and Climate Plan (NECP),” Heikki Willstedt Mesa, energy policy and climate change director at the Spanish Wind Energy Association (AEE) told Recharge.

Spain last week approved a royal decree which sets out how the new bidding system will work. The decree introduces a so-called “pay-as-bid” system, a big shift away from the previous capacity and investment model which awarded a return on investment on top of market revenue.

Mesa said it is likely that following its December launch the 3.1GW auction will be held during one day in January or February 2021. “The winners, who should be known the day after auction, will be awarded a pay-as-bid price for their electricity (euro per MWh) under a contract-for-difference type scheme.

“The AEE will probably ask the transition ministry to increase the 1GW of wind to be auctioned,” added Mesa, but declined to comment by how much. “We don’t yet know, and it will depend on our consultations with the ministry,” he said.

Certain details are not yet known which are important for developers.

Following the first tender launch next month it is envisaged subsequent annual auctions will award 3.5GW each year from 2021 to 2025. These auctions are planned to include 1.5GW of wind, 1.8GW of solar PV, 100MW of solar thermal and 60MW of biomass.

“In principle, the new system is simpler than the previous one but there are certain details that are not yet known which are important for developers in order to decide whether they participate in the auction,” said Mesa.

He said these details will only be known when the ecological transition ministry actually launches the auction next month. “In general the AEE hopes that the auctions will strengthen the Spanish wind market and maintain the manufacturing sites with a good workload in the medium term.”

Offshore auction expected

Mesa also revealed to Recharge that the AEE expects “a separate auction and incentive programme” for offshore wind projects to be announced by the government in the second half of 2021. “The necessary legislative framework for offshore wind in Spain has not yet been adopted,” he said.

Interest is growing in exploiting projects off the Canary Islands with EDP Renovaveis submitting documentation to the Spanish government with a view to building a 144MW floating wind farm in the deeps off the island of Grand Canaria. This project would be sited near a 250MW floating wind cluster being advanced by Greenalia off Arinaga – the site of Spain’s first offshore wind test turbine installed in 2013.

Additionally, a 120MW-140MW Canary Islands onshore wind auction will be launched next month. Interested parties will have three months to submit all the necessary documents to participate with awards expected in mid-2021.

Spain’s renewables sector has long been calling for new auctions, spurred by the government’s far-reaching climate and energy reforms, to be held as quickly as possible, pointing out that the last such auctions were held in 2016 and 2017.

The ministry said the auctions would help Spain to install around 60GW of renewable energy by the end of the decade, as it had committed to in its 2021-2030 NECP.

Spain installed 2.3GW of onshore wind last year, the most in Europe, thanks to the capacity awarded in the 2016/2017 tenders, but the industry has warned that this would not continue without the new auctions.

Wind

Wind industry lukewarm as Spain's renewables auction relaunch 'lacks detail'