Spain 3GW auction pencilled in for 18 July with price reduction changes

the-possible-price-reductions-for-both-wind-and-solar-have-been-increased-in-what-could-be-a-boon-for-solar-credit-abb-spain-3gw-auction-pencilled-in-for-18-july-with-price-reduction-changes

The possible price reductions for both wind and solar have been increased in what could be a boon for solar. Credit: ABB

Spain’s energy ministry has earmarked its next 3GW renewable energy auction to take place on the 18 July and introduced a bidding parameter change that could give solar PV a stronger chance of succeeding than in the previous auction, under a draft regulation sent to the CNMC.

Aida Gonzalez Palomino, energy policy director at Spanish solar association, UNEF, told PV Tech that although the regulation issued is still in draft stage, it is unlikely to change.

The possible reduction in prices, or discount, for both wind and solar has been increased:

May auction (maximum discount)July auction (maximum discount)
Wind63.42%81.91%
solar51.22%65.80%

This is critical, because if both wind and solar developers bid for the maximum reduction, this results in a tie. In a tie, capacity is then awarded to the technology with the longest generating hours which is wind. This is why wind took away almost the entire 3GW in the previous May auction.

However, solar is considered to be more capable of reaching lower prices. Therefore, the new increased possible price reductions for both wind and solar could conceivably open the door for solar PV to win some capacity in the July auction.

Asked if solar now has a better chance, Palomino said there are differing opinions. Some parts of the industry believe the maximum discount for wind is now particularly high and may be difficult for wind developers to hit, while others believe that wind developers may still go for the maximum discount and then rely on the market floor price.

She added: “It’s complicated to say. We will see more PV than in the first auction, but we will see wind as well.”

Tags: spain, auction, unef, discount, price, tariff, tender

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