Wind Energy Sees Tensions In The Supply Chain

The Wind Business Association yesterday issued a warning to the Government about renewable auctions. The sector’s employers’ association warned about the tension in the supply chain and fears that it will be transferred to the sector due to the award of the auction capacity at such a competitive price in a situation of increasing cost of raw materials and logistics .

The total wind power awarded in this auction was 2,258 MW at an average price of 30.18 euros / MWh. This amount is in addition to the 998 MW allocated in the January auction. All of them must be put into operation before October 2024 and represent a weighted average price of electricity of 28.67 euros / MWh.

The employer warns of the need to speed up the processing of projects in all autonomous communities
For the employers, both factors have been the key that has conditioned the participation of the actors in the auction and the prices offered. It should be remembered that neither Iberdrola, nor Acciona, nor Endesa presented themselves to it; three of the main promoters of renewable energies in the country. This decision has cleared the way for companies such as Capital Energy or Forestalia to have been able to acquire a large capacity and, in the case of the former, to establish themselves as the great winner in these competitive processes.

The companies consider that thanks to their level of competitiveness they will be able to cope with the construction of these facilities, but the wind sector fears that there will be a downward pressure on prices.

The wind power association warns of the need to speed up the processing of projects in all autonomous communities so that there is no bottleneck in the administrative procedure and at the connection points.

The wind industry in Spain has 100% of the value chain, developed in more than 250 industrial centers in all communities.

This chain is currently subject to economic tensions due to the prices of raw materials in a global market in which it operates, so having local projects of a comparable size would allow it to gain stability. The 2,258 MW awarded in the auction are equivalent to 450 wind turbines, which implies a workload lower than the capacity of the wind industry, which is close to 4,500 MW / year. Hence the importance of continuing to bet on complementary schemes such as PPA and merchant, which guarantee a rhythm of orders to factories during 2022 and 2023 as critical periods.

For the wind sector, auctions must be focused on maximizing value and not minimizing price, so as to maximize the contributions that each technology makes to the economy, job creation, savings for citizens, the chain of existing supply, the benefit to the local communities, the efficiency of the use of the infrastructures and the reduction of emissions.

The auction will involve contributing around 1% of the energy consumed in the country. A total of 61 agents participated in it, presenting more than 5,100 MW, 54.5% above the offer.