Repsol breaks into renewables auctions to compete with Endesa, Naturgy and Iberdrola

The calendar programmed by the Government to auction 20 gigawatts (GW) of renewables until 2025 begins tomorrow, the 26th, with Endesa, Naturgy, Repsol and Iberdrola as protagonists, among other companies in the energy sector.

Specifically, the Executive will hold the first renewables auction since July 2017, with a target quota of 3,000 megawatts (MW), according to the calling order approved by the Ministry for the Ecological Transition and the Demographic Challenge.

Of this power, at least 1,000 MW will correspond to photovoltaic and another 1,000 to onshore wind, while the rest will remain without technological restriction.

They will be able to bid both new and existing facilities for expansion that are located in the peninsular electrical system and whose storage system, if available, is used to store the energy produced in the facility.

The maximum delivery term for the committed energy is 12 years for photovoltaic, solar thermoelectric, onshore and offshore wind and hydroelectric technologies and 15 years for biomass, biogas and bioliquid technologies.

Bids will be made on the price required for the energy produced and the volume of product awarded to the same business group.

It may not exceed 50% of the product quota (1,500 MW).

The participants have presented a plan with estimates of the impact on local employment and opportunities for the industrial value chain.

More information

• BP consolidates its commitment to renewables in Spain with the purchase of 1 GW from RIC Energy

• The energy companies prepare the green transition with 50,000 million investment

• The Government will auction 3,000 renewable megawatts on January 26

The Executive plans to auction at least 19.44 GW of renewable power until 2025: 8,500 MW of wind, 10,000 MW of photovoltaic, 500 MW of thermosolar, 380 MW of biomass and 60 MW of other technologies, such as biogas, hydroelectric or tidal wave (see graph).

Endesa, Naturgy, Acciona and Forestalia have confirmed to

CincoDías

that they will bid for a portion of the cake.

Iberdrola prefers not to comment.

However, it will do the same, according to industry sources.

Iberdrola is usually very selective in auctions.

In the last of 2017, the project was not awarded, in view of the prices listed.

However, it has obtained 83 photovoltaic MW of power in the last auction held in 2020 in Portugal (there it already has 1,500 MW of renewable capacity).

Other companies such as Cepsa or Solarpack have no intention of presenting any offer on Tuesday, they told this newspaper.

The CEO of Endesa, José Bogas, has indicated that his company will attend the next auctions that take place despite the fact that it does not need this mechanism to build and finance its installation.

Repsol, for its part, also has it in its portfolio.

Its CEO, Josu Jon Imaz, already advanced the idea in November at the presentation of the company's strategic plan for 2021-2025.

"We are open and we do not rule out that we can use these mechanisms and that we complete them with other projects that we can take outside the auctions," he said.

This is your first time and a good showcase to renew your commitment to your shift towards a greener business model.

Of the 18,300 million that the company will invest in energy transition over the next five years, 5,500 will go to low-carbon initiatives: 4,300 for the development of renewables and 1,100 to reduce emissions from its industrial division.

It also weighs the IPO of its renewable business.

Forestalia was one of the winners of the auctions held in 2016 and 2017, when it was awarded 1,200 MW of photovoltaic power, but a large part of that power (650 MW, including 50 MW of biomass) could not be put into operation within the required period and had to pay the guarantees: up to a maximum of 60,000 euros per MW.

Now he will bid again to take another piece of the pie.

So did Cobra (a subsidiary of ACS), which took 1,500 MW in the last auction in 2017. And X-Elio, 455 MW.

The sector understands renewable auctions as a necessary mechanism to develop the entire process of decarbonization of the economy that is being promoted by the fourth vice president and minister for the Ecological Transition, Teresa Ribera.

In addition, developers who have little renewable power and who do not have a large enough project portfolio are admitted.

It is also a good option for companies with clients that still do not have a sufficient generation park.

On the negative side, many of the companies consulted agree that there will be others willing to push the price of the megawatt in order to win.

The Integrated Climate Energy Plan (PNIEC) 2021-2030 foresees the installation in Spain of 60 GW renewables, which is equivalent to about 5,500 MW per year.

Part of this capacity will be installed with the support of auctions, while the rest will be able to benefit from other instruments, such as investment aid from the European Regional Development Fund (Feder) or medium-term energy supply contracts (PPA ).

Large electric companies oppose the mechanism

The large electricity companies have shown their reluctance to auction because they have the capacity to undertake projects in the free market or through long-term contracts (PPA) with large consumers.

They also have the option of resorting to corporate financing.

Smaller firms believe that they want to avoid competition and not lose the power of the generation market that they now have. As underlined by the royal decree, the proposed auction mechanism "facilitates access to financing for renewable energy projects for developers."