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The Increasing Demand for Renewable Energy in Spain

In the last decade, renewables have grown rapidly across Spain, which has led both public and private companies to bet on the renewable energy sector.


The increasing palpable effects of climate change and the increasing global population have called for
a shift in energy generation by announcing plans for full decarbonisation by 2050. 

This has caught the interest of banks and other private corporations to invest in the development, improvement, and implementation of countless renewable energy sources.

The Current State of Renewable Energy in Spain

Spain has been making significant strides in its renewable energy production. As of 2024, the share of energy from renewable sources in electricity generation in Spain has climbed to 50.3%, owing mostly to favourable weather conditions.

In a similar vein, Spain has been progressively reducing its reliance on coal-fired plants. This effort began in earnest in 2020 when the country cut down on coal-fired plants by 60% compared to 2019, reaching an all-time low share of 2% in the total generation. This trend of moving away from coal has continued into 2024.

By August of this year, the largest coal-fired power plant in Spain is set to cease operations, which will further decrease the share of coal in Spain’s total energy generation. This marks a significant step in Spain’s transition towards more sustainable and renewable sources of energy.

Spain currently stands as a global leader in wind energy development. This position is not only due to the country’s significant wind resources but also because of its commitment to implementing mega-programmes aimed at reducing emissions, creating jobs, and lowering energy prices.

In a significant move to accelerate the expansion of wind energy, the Spanish government and the wind industry have come together to sign the ‘Spanish Wind Charter’. This agreement underscores their shared commitment to harnessing wind power for the country’s energy needs. As a testament to these efforts, wind energy has become the primary source of electricity in Spain, contributing 27% of the total electricity consumed.

Spain’s commitment to green energy spending remains robust. To achieve its energy and climate ambition, it is estimated that an investment of EUR 294 billion will be mobilised.

Furthermore, solar energy in Spain has become increasingly competitive. The Spanish solar energy market is expected to reach 34.49 gigawatts in 2024 and grow at a CAGR of 15.96% to reach 72.32 gigawatts by 2029. This growth is driven by the decreasing prices of PV Modules and other basic components as the sector matures and solar companies adopt large-scale production.

In the recent Spanish renewables auction, the results were different from previous years. The auction concluded with only 45 MW of assigned wind capacity, with no solar capacity awarded. This is a shift from the previous trend where solar won the bulk of capacity on offer.

While these results are promising, Spain still has work to do to achieve its 2050 targets. The country needs to continue increasing the efficiency of its production plants, secure their electricity storage, and develop infrastructure to accommodate the incoming demand for electric vehicles. The country is committed to becoming a circular, carbon-neutral economy by 2050.

 

The Growing Demand and Development

It’s also important to note that the population of Spanish people living in cities is increasing rapidly – from 70% to more than 80% within two years.

The right investments, infrastructure, and energy policies will ensure Spain meets its carbon reduction targets. 

The Spanish government is committed to installing at least 4,000 MW of wind and solar power capacity each year for the next ten years. In 2024, Spain is a leader in onshore wind installations in Europe. The country has nearly doubled its renewable energy capacity from 28.5GW to approximately 56GW. This includes an impressive 62GW of wind power. Additionally, the solar power capacity has also seen a significant increase, reaching around 76GW.

By 2030 the goal is to achieve a renewable energy production that accounts for 42% of the total energy demand. This is an ambitious goal, which requires mobilising enough resources in the next ten years to carry out and articulate a social and business response to achieve these goals. 

To achieve this energy transition, Spain needs a stable regulatory framework. This objective is also aligned with the postulates of the 2016 Paris Agreement, which established measures to reduce greenhouse gases. 

For example, countries belonging to the European Union would have to reduce their emissions by 20% and reach the same percentage in renewable energy production. 

Additionally, the Spanish government has declared they will eliminate the use of coal as well as stop selling all vehicles that emit carbon dioxide within the next decade. 

It is evident that renewable energies are consolidating little by little as viable alternatives, all thanks to public and private investments. 

 

In simple words, Spain is one of the few countries that have opted the most towards a sustainable paradigm, which is leading to progressive decarbonisation in different industries. 

This sunny side of Europe offers huge scope for companies and communities to come together to eradicate climate change effects by promoting and investing in renewables

 

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