Challenges and prospects for the PV sector in Spain

PV energy worldwide has once again set a new record for installed capacity in 2016, connecting 76.8 GW and representing a growth of 50% on the amount installed the previous year. The PV market has experienced an important change in recent years, going from being an essentially European market, motivated by environmental issues, to undertaking most projects in emerging markets where the motivation is price competitiveness and guaranteed supply.

Even though only 55 MW were installed in Spain last year, the sector has started to breathe winds of change. After five years of moratorium, the sector feels stronger and ready to change political risk for market risk. The lack of trust in government policies, the high competitive level achieved by the technology, the huge natural resource available in Spain, the liquidity existing in the financial markets and the possibility of obtaining additional revenue by taking part in auxiliary services are all reasons that encourage PV developers to test the possibility of going directly to the market.


However, this path is not without its obstacles. The first and most significant is the inadequacy of the marginal system of setting prices in the electricity markets. A system designed in the 1980s, based on costs variables, could not be more inappropriate for establishing the price of technologies that do not have such variables and that are enjoying an increasingly greater presence in the energy mix.
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José Donoso
Managing Director, UNEF, the Spanish Solar Association

Article published in: FuturENERGY July-August 2017