“Spain is the hottest PPA market in the world, but auctions are necessary”

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From pv magazine Spain.

“The [solar] sector is called upon to be the [chief] protagonist to meet the ambitious targets of achieving a 74% renewable energy penetration by 2030” – with these words José Donoso, director-general of Spanish solar energy association UNEF, opened the Solar plants in Spain: development, financing and energy future conference in Madrid on Tuesday.

The event attracted around 400 attendees, who were urged to “learn from experience” and “not … neglect international markets”.

Conference organizer Soltec said anticipated annual deployment of 3 GW should further motivate the solar sector, which can sustain Spain’s industrial growth. But, it added, the market needs R&D investment, which would translate into cheaper energy and economic growth.

“We do not want premiums or subsidies, we want to go to the market,” said Donoso, whose appeal was corroborated by Raul Morales, CEO of tracker manufacturer Soltec, in his opening speech. “The help requested by the sector is that we are not hindered,” said Morales, “the procedures and environmental impact studies [associated with solar projects] are too long.”

Another 4 GW on the way

Jesús Ferrero, deputy general director of renewable energies at Spain’s Ministry for the Ecological Transition, said the government’s Royal Decree for self-consumption would be approved in time. He also called for R&D investment in the sector to help drive the nation’s 2030 energy transition goals.

Ferrero also announced around 3.9 GW of the 4 GW assigned in the renewables auction held in July 2017 has been accredited, meaning the capacity has a very good chance of being grid connected.

The speakers on a ‘development of photovoltaic plants in Spain’ panel unanimously agreed it was possible to install at least 3 GW per year in the country, and said the nation is posied at a moment as exciting as its entry into the EU, 33 years ago.

The conference heard solar will account for more than 60% of Spain’s new renewable capacity in the years ahead, due to its cost advantages.

As far as technological innovations were concerned, bifacial modules and batteries were hot topics. If battery costs fall to a similar level as the current Spanish energy network costs of €0.05-0.07/kWh, they could prove a game changer.

Bifacial and storage the must-haves this season

Bifacial technology is also set to spread rapidly. Christian Comes, product manager for Canadian Solar, said that by next year, 40% of large PV plants around the world will use bifacial modules – in China, he added, half of all new plants already use the technology. José Alfonso Teruel, from Soltec, said when bifacial panels are combined with its trackers, they can ensure an 2.5% increase in output.

Valencia-based Power Electronics, which will supply 16 GW of solar products this year, is also confident storage deployment will expand, as is already the case in Australia and the United Kingdom, the main markets for its storage systems.

Spain is the hottest PPA market in the world,” said the representative of power company Holaluz on the ‘PPA vs. auction’ panel. Participants agreed auctions were still essential and should run according to international standards. “These should be based on production, not capacity,” said the Holaluz spokesperson. In addition, there should be specific auctions for small projects, so the atomization of the market is maintained and a handful of companies do not dominate. UNEF said auctions were necessary but must change, with specific tenders added for hybrid projects combining solar, wind and storage.

Show me the money

Regarding, bilateral PPAs, competitive agreements were said to help improve the industry. Not only because they improve the levelized cost of electricity, but because signing a renewable PPA for €43-51/MWh can make producing hydrogen at €8/kg feasible.

The subject of financing also prompted optimism with the news half the world’s infrastructure investments go to renewables. “It is evident that there will not be only Spanish financing,” said UNEF chief Donoso. “Fundamentally because the banks will not want to cover the possible risk of the sector. So we will need international financing. But Spain is again a credible actor for funds and international banking.”

The conference witnessed a sector that is is optimistic and confident, to the extent Donoso warned: “The Solar Forum is held this year on October 24 and 25. I’d like to reserve so that no one is left without a seat!”