Windmills were formerly the main feature of Castilla-La Mancha, a patchwork plain in central Spain. However, the contemporary version of them is now much more noticeable on the region’s skyline: wind turbines. This panorama is viewed from the 28 enormous turbines of the Sierra del Romeral windfarm, which is situated atop hills not far from Toledo’s old centre.

These are run by the Spanish company Iberdrola and are a part of a trend that has increased Spain’s output of renewable energy over the last five years, solidifying its position as a significant player in the sector.

Since 2008, Spain’s primary renewable energy source—wind power—has quadrupled in overall capacity. In the same time span, solar energy capacity has grown by a factor of eight.

With Sweden holding the top spot, this places Spain as the EU member state with the second-largest renewable energy infrastructure. Pedro Sánchez, the prime minister of Spain’s Socialist Workers’ Party, referred to his nation as “a driving force of the energy transition on a global scale” earlier this year.

With the elimination of legislative barriers and the provision of incentives for the installation of renewable energy sources, the boom started shortly after the election of Mr. Sánchez’s new administration in 2018. Domestically, the pandemic drove the tendency even further.

“The impact of Covid was very positive for our sector,” says José Donoso, chief executive of UNEF, the Spanish Photovoltaic Association, which represents the solar panel sector. “People saved money, took time to think about what to do with it, and many of them decided that it was better invested on their roof than in their bank.”

In the meanwhile, the government unveiled bold new goals, such as using renewable energy sources to provide 81% of Spain’s electricity demands by 2030.

Notwithstanding this remarkable feat, apprehensions exist within the electrical sector due to an asymmetry between the availability and use of electricity, occasionally resulting in an excess of it.

Power usage has been declining recently, despite the fact that Spain’s economy has recovered well from the shock of the Covid epidemic and is expanding faster than any other major country in the union.

The demand for power last year was at its lowest point since 2003 and much lower than it was in the pandemic year 2020.

Head of system development at Red Eléctrica (REE), the corporation that runs Spain’s national grid, Miguel de la Torre Rodríguez says, “What we saw up until 2005 was that when GDP increased, demand for electricity increased more than GDP.”

He states, “We’ve observed that demand has expanded less than GDP more lately. The decoupling of energy intensity from the economy is what we are witnessing.

The current decline in demand can be attributed to several factors. Among these is the energy crisis that resulted from Russia’s invasion of Ukraine in 2022, which led to consumption reductions in households and companies throughout Europe.

Furthermore, energy efficiency has advanced and spread.

The decrease in demand for power from the national grid is partly attributable to the growing use of renewable energy.

According to Rodriguez, prices may be impacted when the supply-demand balance is thrown off during the day, when solar energy generation is at its highest.

“Since the power system always has to have an equilibrium – demand has to equal generation – that has meant there has been excess generation during those hours,” according to him.

“That has driven prices down, especially during certain hours, when the prices have been zero or even negative.”

Although customers appreciate such cheap costs, the sector may find it difficult to draw in new investment as a result of them.

According to Sara Pizzinato, a renewable energy specialist at Greenpeace Spain, “this can make it more difficult for investors to increase their investment in new electricity based on renewable energies.”

“That can be a bottleneck for the energy transition.”

The need to expedite the “electrification” of the economy—that is, its shift away from fossil fuels—has come up as a result of worries that Spain may have too much power. By 2030, the Sánchez administration wants 34% of the economy to be powered by electricity.

“This process is going slowly, and we need to accelerate it,” says UNEF’s José Donoso.

“Electricity is the cheapest and most competitive way to produce clean energy.

“We need facilities that use electricity in place of fossil fuels.”

It is viewed as impractical to rely only on electricity since several significant industries, such as metals and chemicals, will find it challenging to make the switch.

Donoso and others, though, believe there is a lot of room for quicker electrification. For instance, Spain is lagging behind many of its neighbours in Europe when it comes to using electric cars, which now make up just around 6% of all vehicles on the road, and installing heat pumps in houses.

Pizzinato concurs that electrification is essential, but argues that there are alternative approaches to address the supply-demand dilemma, such as accelerating the phase-out of nuclear power facilities and boosting energy storage capacity.

She says: “We need to engage more people and more industries in demand-side management, to make sure the flexibility needed in the system is out there to make generation and demand match better during the day and during the night.”

(Adapted from BBC.com)

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