Spain’s government moves to get public to install solar panels

Spain’s government adopted a series of measures on Tuesday aimed at encouraging the public to install solar panels to generate their own electricity as the energy crisis sparked by Russia’s Ukraine war grinds on.

Spain's government moves to get public to install solar panels
Spanish Environment and Energy Minister Teresa Ribera wants to encourage Spaniards to install solar panels at home. (Photo by JOHN THYS / AFP)

“There is a lot of interest” in the idea of a household generating its own energy, which is “a very reasonable way to reduce our bills,” Spain’s Ecology Minister Teresa Ribera said after the weekly cabinet meeting.

Individual energy generation could be encouraged by means of “a simplified form of regulation,” she said of measures which align with a European push to reduce the bloc’s reliance on Russian gas.

The move simplifies the process for installing solar panels with a power generation capacity of up to 500 kilowatt/hours and seeks to encourage the installation of photovoltaic panels on public buildings.

The Spanish government is also promising tax deductions for people who install solar panels, although it has not yet confirmed how much this will be.

READ ALSO: Do I need a permit to install solar panels in Spain?

It also seeks to drum up support for “collective power generation”, backing the installation of solar panels on apartment blocks in a country where nearly two-thirds of the population live in flats.

Self-generated electricity has been growing rapidly in Spain since 2018, when Madrid abolished a decree requiring individuals who feed energy back into the grid to pay tax.

The tariff had long been decried by its opponents as a “tax on the sun”.

According to Spanish solar power lobby UNEF, the installed capacity for individual energy generation through solar panels reached 1,203 megawatts in 2021, twice that of the 596 megawatts a year earlier.

And the figure is expected to be significantly higher in 2022.

The government’s energy-saving plan seeks to cut Spain’s natural gas consumption by up to 13.5% by March, and it also extends a price cap on gas used to produce electricity until December 2023 in order to alleviate household energy bills.

In April, Spain and Portugal reached an agreement with Brussels to separate electricity prices from the price of gas, allowing them to slash electricity prices.

Known as the “Iberian exception”, the price cap came into effect in June.

READ ALSO: What you should know before getting solar panels for your home in Spain

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‘Impossible to keep track’: Spain’s big gamble on green hydrogen

Major green energy projects are sprouting up across Spain as it seeks to position itself as world leader in this sector, but experts have urged caution over costs and demand uncertainty.

'Impossible to keep track': Spain's big gamble on green hydrogen

Spanish firms are ramping up production of emissions-free fuel and ploughing investment into green energy projects, despite fears over the high price of production.

“Everything is going very fast,” said Miguel Ángel Fernández, technical director at the Spanish National Hydrogen Centre, a public research centre based in central Spain.

“There are so many projects, it is impossible to keep track of them all.”

Most hydrogen is currently produced using polluting fossil fuels but so-called “green hydrogen” is made entirely using renewable energy such as wind, solar and hydropower.

While fossil fuels emit harmful greenhouse gases when they burn, hydrogen only emits water vapour.

Madrid launched a €1.5-billion ($1.7-billion) plan in in 2021 to support green hydrogen projects, using a European Union Covid recovery fund.

Spain is now home to 20 percent of the world’s green hydrogen projects — second only to the United States.

Last year Spanish energy giant Iberdrola started operating what it says is the largest green hydrogen plant for industrial use in Europe, in the former mining town of Puertollano.

The plant uses 100 megawatts of solar panels to produce green hydrogen, which is stored in huge white storage tanks.

The initial goal is for it to provide 10 percent of the energy needed by a neighbouring factory belonging to fertiliser maker Fertiberia.

This will prevent the release of 48,000 tonnes of planet-warming carbon dioxide per year according to Iberdrola.

From Andalusia to the Basque Country, green hydrogen megaprojects are multiplying in Spain, a leading country in this promising sector. It’s still a risky bet while the economic model for this ‘energy of the future’ remains to be found. (Photo by Valentin BONTEMPS / AFP)

If the pilot project works, Iberdrola will launch a “much more important second phase” to meet 100 percent of the fertiliser plant’s energy needs, said Javier Plaza, head of Iberdrola’s green hydrogen division.

Rival Spanish energy firms such as Cepsa and Repsol have in recent months launched similar projects.

In Spain’s sunny southern Andalusia region, three billion euros is being invested to create a “green hydrogen valley” where two large factories will produce 300,000 tonnes of green hydrogen per year from 2027.

In the northern region of Asturias 15 solar power parks will be built by 2030 to enable the annual production of 330,000 tonnes of green hydrogen.

Rafael Cossent, research associate professor in energy economics at Madrid’s Comillas Pontifical University, said there was an “effervescence” in the sector putting Spain in a leading role in green hydrogen production.

This is partly due to Spain’s abundant sun and wind power capabilities, he added.

The Spanish Hydrogen Association estimates there are currently 50 green hydrogen projects under development in the country.

Spain could potentially produce enough green hydrogen to cover its own needs and export to northern Europe, the association argues.

A major drawback for green hydrogen, however, has been the high cost of producing it.

Green hydrogen is made by using renewable energy such as wind, solar and hydropower. (Photo by ANDER GILLENEA / AFP)

While the price of the renewable energy used to make it has come down due to technological advances, green hydrogen has still not proven itself to be economically viable.

Massive use of green hydrogen will also require “complex transformations” by vehicles and industrial plants which make future demand for the fuel uncertain, said Cossent.

A green hydrogen economy will need a robust transportation infrastructure to transport it — which Spain is currently lacking.

The government is counting on a planned underwater pipeline between Barcelona and Marseille, dubbed H2Med, which is expected to transport some two million metric tonnes of hydrogen annually.

Hydrogen is difficult to contain without leakage however, making it challenging to store and transport, so delays to the pipeline are widely expected.

But the giants of the green hydrogen market are undeterred.

Iberdrola’s Plaza said it is important to get into green hydrogen early because “whoever starts first has the advantage”.

“We are talking about a long-term race,” he added.