This Great industry has been preparing for a major purchase for over a year. renewable electricity fixed price in order to avoid the impact of electricity price hikes and lower your electricity bill. Delays continue to accumulate in the first long-awaited ‘mega-auction’ for renewable energy promoted by private companies in Spain. Originally scheduled for the first quarter of 2022 and intended to be held at different times in 2023 so far, the organizers have now decided Postpone bidding to a point in the end of the year.
Bringing together nearly thirty major industrial groups operating in Spain, the Spanish Association of Major Energy Consumption Companies (AEGE) ensures that the auction design is practically complete, but still It is necessary to agree on the exact mechanism It will be used by the government (with the Ministry of Ecological Transition and the Ministry of Finance) as well as the regulators, the National Markets and Competition Commission (CNMC) and the National Exchange Commission (CNMV).
Once these last fringes are closed with the administration, AEGE will initiate an information process for those wishing to sell renewable electricity and activate a pre-qualification process for participants that can take two or three months. Employer avoids specifying timetable for tender, but date is confirmed postponing until after summer and predictably last quarter.
The major electricity consumers association is separating the new postponement from before the general elections on July 23. “Processes to be carried out, strictly administrative, not politicalPedro González, managing director of AEGE, highlights El Periódico de España from the Prensa Ibérica group. “Election progress is not involved. All the details are simply not resolved and we have to do the auction with all the guarantees”.
shield against elevation
The association of electro-intensive groups, which includes giants such as ArcelorMittal, Acerinox, Sidenor, Sener, Ferroatlántica or Tubos Reunidos, is working to launch its own system of renewable energy auctions outside of those regulated by the Government. The aim is to provide a significant part of the electricity supply they need for their activities and to use this as a fixed price for a long timeor between 10 and 12 years.
Currently, about 80% of the electricity consumed by the major Spanish industry is purchased directly from the wholesale electricity market, so when there are large increases in the price of electricity they are subject to price fluctuations and the assumption of strong increases in production costs.
Major industries’ plans include calling on wind and photovoltaic manufacturers to submit offers to sell electricity at a fixed price. Subsequently, industrial and power companies would sign bilateral energy purchase agreements or PPAs (“energy purchase agreements”) that would receive Government approval through the Spanish Reserve Fund for Guarantees of Electro-intensive Enterprises (FERGEI).
Major industry has warned for years that high electricity prices in Spain are a blow to its profitability, and this difficult to compete with companies from other European countries. A situation exacerbated by the spiral of electricity surge at the worst of the energy crisis and the current difficulty of closing bilateral contracts with power companies at attractive prices.
Pending legal reforms
The hasty progress of the general elections towards the end of July could affect many of the regulations in the process that directly affect industrial groups that are large electricity consumers, both in the form of reductions in bills and compensation, and direct assistance to mitigate the blow. due to high energy costs. Airborne regulations affecting electro-intensive devices may continue to be approved by the Government after the election call, as they will be clearly articulated. by royal decree or ministerial orders The executive has the power to approve such legislative texts.
The government has aimed to introduce a royal decree to the Cabinet in the coming weeks to reformulate the Status of Electro-Intensive Consumers to adapt it to the new EU aid regulation, and sectors that can benefit from economic benefits, with some requirements to be beneficiaries, will increase rapidly, as well as the number of companies that benefit. . The number of beneficiary sectors will increase from the current 62 to a total of 118 and the number of companies benefiting from the reduction of invoice fees will increase from the current 610 to a total of 1,050 companies.
As part of extraordinary measures to mitigate the impact of the rise in light contained in the government’s anti-crisis decrees, Temporary reduction of 80% of tolls paid by electro-intensive companies on your electricity bill (where investments in electricity distribution and transmission networks are paid). The executive must decide whether to extend the measure beyond 30 June, and AEGE is already pressing for this reduction to continue through at least 2023.
In parallel, large industry benefits from an aid system each year to offset the costs of indirect CO2 emissions. The executive has approved an item of 244 million euros for this aid for this year, which is equal to the amount distributed the previous year. To offset the skyrocketing costs of emissions rights (around 80 euros per tonne of CO2 last year, more than double what it was before the crisis), AEGE is asking the Ministry of Industry to increase that amount to between 400 and 500 million this year. The government has shown a willingness to increase the budget to mitigate major industry’s energy costs and has rated the scales advocated by the AEGE as “reasonable,” but the review has yet to be approved and there is no date to do so.