2024-07-09 09:48:16
Spain has developed its capacity to generate electricity from renewable sources so quickly that there is often an imbalance between energy supply and demand, especially during hours of high solar production. Making the network more flexible and electrifying the economy are priorities for the sector.
Power House in Renewable Energy
Spain has doubled its wind capacity in the last fifteen years, making it the number one source of energy above nuclear energy. Spain’s solar industry has increased eightfold during the same period. Due to a favorable climate, the removal of regulatory obstacles and the introduction of subsidies for installation, Spain is the second country in the European Union in terms of renewable capacity.
The Problem of Excess Production
Now, there is a dilemma of excessive production. Despite the increase in GDP, electricity consumption has been falling in recent years in Spain. The demand for electricity in 2023 was lower than in 2020 during the pandemic, and the lowest since 2003. There is a decoupling between energy demand and the economy, due to high prices in the years after the invasion of Ukraine (which discourages consumption) and more energy. efficiency, but also an excess of renewable energy.
How does Surplus Energy affect
The electrical system needs balance: electricity demand must equal generation. But during daylight hours, when solar energy production is particularly strong, the balance between supply and demand is destabilized, driving prices down and even into the negative. Although very low prices benefit consumers, they are a problem that can attract investment to the industry and paradoxically can be an obstacle to the energy transition.
Electrification of the Economy
Concerns about excess electricity in Spain make it necessary to further reduce the country’s dependence on fossil fuels. The government has set a target for 34% of the economy to depend on electricity by 2030. Electricity can be the cheapest and most competitive way to produce clean energy, but many facilities need to be reformed to support sectors important in Spain to electrify, for example chemicals. and metals.
Opportunities on the Consumer side
Spain has fallen behind many of its European neighbors in the installation of heat pumps in homes and in the use of electric cars, which represent only 6% of vehicles in circulation.
Increase Flexibility
There are other ways to address the decoupling between supply and demand, such as increasing energy storage capacity by installing large-scale batteries. Installing batteries on both the supply and demand side of energy ensures flexibility in the system to match electricity generation and demand during the day and night, as is increasingly common in California.
A European Global Problem
This situation is characteristic of the type of electricity grid that Europe will have as there will be a greater participation of solar energy. Gas plants do not run continuously: they only work for an hour or two and then stop, incurring additional costs just to start up. These costs must be compensated in some way, which increases electricity prices. Large-scale batteries could help balance residual load (demand, less solar and wind power) across Europe.
Adaptation to Energy Transfer
The shift towards cleaner and more sustainable energy sources could lead to negative prices and spikes in the cost of electricity. It will be vital for everyone involved in the energy market to adapt to these changes.
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