large Spanish industry using cogeneration generating electricity by utilizing the operating heat of its factories in sectors such as ceramics, paper or food. claiming millions of compensation for losses amid the energy crisis, it suffered from low wages set by law by the Government, causing many factories to shut down both last year and this year.
Almost hundred cogeneration plants presented an avalanche of resources Controversial administrative proceedings have been brought to El Periódico de España in recent weeks in the Supreme Court to seek redress for damages suffered by the regulatory framework established by the Ministry of Ecological Transition to guarantee compensation to companies, as confirmed by many sources from the industrial sector. , from the group Prensa Ibérica.
Last year, nearly two-thirds of cogeneration plants had to stop as electricity generation caused losses, despite being a regulated sector guaranteed by law to meet costs. And right now, already this year, the electricity production of the plants has dropped by more than 50% as the accounts haven’t come out.
Cogeneration plants have to purchase gas for their industrial processes and generate electricity for a fee guaranteed by law through the Recore system (the system used by regulated renewable energy sources, which received premiums previously). However, industry groups said that the sharp rise in gas prices last year and the lower price of electricity in the wholesale market than predicted by the Government caused them to inflict record losses because The government did not take measures to ensure that the facilities cover their costs. generation.
New methodology
The government is preparing a comprehensive reform of the cogeneration compensation model. The Ministry of Ecological Transition, under the command of Vice President Teresa Ribera, A proposal for a new methodology for wage calculation As confirmed by the ministry to Cogen and Acogen industry associations, it will soon launch a public consultation to enable the industry.
The new methodology is overdue. The manager promised to prepare a proposal for a new compensation plan before May 31, but this new model is yet to come and for now, the current model has expanded the sine pattern, which will be maintained until the new framework takes effect. . The industry is calling for a new model as soon as possible to avoid the uncertainty of an industry hit by the crisis and a lack of legal certainty hindering investment.
From the cogeneration sector, which has about 600 power plants in the Spanish market, it is warned that the sector is at risk of an “emergency” if the new methodology is delayed again or the Ministry does not publish updated fee values for the second half of this year.Total collapse as of July 1” and “one hundred percent paralysis of power plants” because the current wage is calculated based on some electricity price estimates that doom them to operate at a loss.
“Collapse” next July?
Cogeneration plants can choose between taking advantage of the compensation they can receive thanks to the ‘Iberian exemption’ (the cap on the price of gas used in electricity generation to lower the price of electricity, and which compensates for the actual cost of the plants). gas) or at Recore’s fee.
What happens is that the current fee values are calculated by the Ministry of Ecological Transition based on the 2018 forecast. price electricity market so high (208 euros per megawatt hour, MWh) and current electricity prices (around 100 euros) that it practically deprives them of any guaranteed wages.
If the government does not update these parameters for the second half of this year, or does not implement comprehensive reform. new methodologycogeneration fee will be zero and all power plants will have to stop from 1 July.
Companies using cogeneration complain. massive delay accumulated implementation of the new methodology (about a year) and demanding that the new system be more flexible rather than creating semi-annual scenarios like the existing one, and that the fees charged by companies based on gas prices are reviewed every month. In principle, the Government’s plans are to establish a new annual methodology, but to accept the possibility of a posteriori adjustments and to guarantee a charge based on actual electricity and gas prices.