A high-level forum organized by the European Commission to promote the expansion of electricity networks for the energy transition is taking place this Thursday in Brussels, Madrid. Spanish companies called on the government this Thursday to increase the investment limit To be able to connect about a thousand solar and wind power plants, which are foreseen for the coming years, to the networks available in this country.
“is-is Strengthening the distribution and transport network is essential.. And this can only be achieved with much more investment. Naturgy and other companies believe that investment limits and existing regulations need to be adapted so that more can be invested and invested faster,” said Francisco Reynés, head of Naturgy, in a speech at the VIII Energy Forum organized by The Economist.
Transport and distribution in Spain are regulated activities carried out under the natural monopoly regime. In the transmission network with Red Eléctrica (REE) and in the distribution network with Iberdrola, Endesa and Naturgy. These companies are responsible for the development of networks but annual investment limit because these investments payments by consumers electricity bills through tolls, one of the regulated costs of the electricity bill.
Currently, the maximum investment limit is 0.65% of annual GDP for transport excluding interconnection investments (approximately 8,626 million euros if calculated with 2022 GDP) and 0.13% of GDP excluding interconnection investments. (according to the previous calculation, 1,725 million euros). distribution, in this case excluding investments related to digitalisation. companies carry For years, these rates have been demanded to be increased or even eliminated.. Even after the pandemic, the Ministry of Ecological Transition temporarily increased the percentages until 2022 to 0.75 percent and 0.14 percent, respectively; these figures represent an amount close to 12 billion euros in GDP compared to last year.
But given the flood of renewable connections expected now, companies are calling for changes to the model. According to José Bogas, Endesa’s CEO, this regulatory system was “designed for other times.” “There are some moments when you have too much control over what is done and Infrastructure investments discouraged. But you have to encourage it and raise the limits,” he explained.
“Renewable energies, which are cheaper than those that depend on fossil fuels, are the only way to reach consumers through transport and distribution networks (…) A significant effort must be made in envisioning networks,” insisted Mario, CEO of Iberdrola Spain. After Ruiz-Tagle humiliated the Government that the PNIEC did not include ‘temporary’ planning of the transport network.
But not only are the owners of distribution networks connecting substations to consumers demanding change, but Arancha Martínez, ‘country manager’ in Spain at renewable energy company X-Elio, focused on the need to plan for change. transport network “dynamic, reviewed every six months and where changes can be made”. Currently, the planning of the networks is carried out in six-year periods (the last one was approved in 2022, with reference to the period 2021-2026).
Just a year ago, in the Greater Energy Security Plan designed by the Government to tackle this problem, caused by the price crisis. ukraine warThe Ministry of Ecological Transition has announced that it will update the content of transportation planning and initiate a new planning for the period to bring “specific changes” to “give viability to short-term strategic projects”. 2024-2029 depends on PNIEC.
In the first case, these are immediate actions derived from the Recovery Plan, such as a substation in Vigo and Sagunto for electric vehicle factories planned by Stellantis and Volkswagen, respectively, according to sources from the department in question. As can be seen from the Royal Decree No. 20/2022 of 27 December announcing the start of this review, these actions may be partially financed from European funds, while the remainder will not be counted within the investment limits.