Spain Auctions 146 MW of Biomass and 31 MW of Solar in October

The auction was held for 520 MW of renewables but was undersubscribed


The Spanish Ministry for Ecological Transition and Demographic Challenge (MITECO) has awarded 146 MW of biomass and 31 MW of distributed solar projects in the third auction under the Renewable Energy Economic Regime (REER).

MITECO held the auction to award 520 MW of renewables, including thermoelectric solar, biomass, distributed solar, and other renewable technologies.

The auction was held against the backdrop of the war in Ukraine. High inflation, rising interest rates, and price tensions in raw materials and equipment were among the reasons for high-priced bids.

MITECO also awarded 31 MW of distributed solar projects, with a capacity equal to or less than 5 MW at an average bid of €53.88 (~$54.19)/MWh or €0.05388 (~$0.05419)/kWh, with the highest bid at €62.5 (~$62.86)/MWh and the lowest bid of €44.98 (~$45.24)/MWh. The capacity awarded is five times higher than in the previous auction.

The government awarded 146 MW of biomass at a weighted average tariff of €93.09 (~$93.63)/MWh, with the highest tariff quoted at €108.19 (~$108.82)/MWh and lowest of €72.38 (~$72.80)/MWh. These prices are higher than those of other renewables.

The electricity to be generated from the capacity awarded will displace 1.7 TWh of gas per year or 0.45% of the country’s consumption in 2021. It will also offset the emission of about 0.35 million tons of CO2 equivalent. The projects with €400 million (~$402.32 million) investment will generate nearly 4,400 jobs.

Spain aims to install 60 GW of renewable energy capacity and account for 74% of overall power generation by 2030.

Last October, Spain auctioned 866 MW of solar projects out of the total tendered capacity of 3,123 MW. Wind projects accounted for a significant chunk of the awarded capacity. Repsol Renovables quoted the lowest bid of €0.028 (~$0.033)/kWh for an onshore wind capacity of 49 MW.

Earlier in 2021, Spain allocated 3.034 GW of renewable energy capacity in its first renewable energy auction since 2017. In all, 2.034 GW of solar photovoltaic capacity was awarded.

The Institute for the Diversification and Saving of Energy (IDAE) would be allocating €181 million (~$214 million) to support renewable energy projects in seven autonomous communities of Spain. The allocation is part of a €316 million (~$375 million) package that MITECO will infuse into the domestic renewable energy sector.