370 industrial plants and more than 1,400 million euro of investment are still waiting for the new government to implement pending regulatory developments aiming at the renewal of cogeneration plants that have become obsolete.
Out of 1,000 cogeneration plants that existed prior to the Energy Reform, only 695 are still in operation. 52% (2,675 MW) want to invest to improve their energy efficiency and be able to compete in international markets. In addition, their renewal would save 1% of the country’s total primary energy, with an associated cost for the electricity system of around 50 million euro per year, boosting competitiveness and employment.
At the annual meeting held yesterday by the Spanish Association of Cogeneration (ACOGEN), its president, Antonio Pérez Palacio, highlighted the key role of cogeneration in Spanish industry and regretted the lack of profitability of cogeneration plants following the energy reform. These plants represent a capacity of 4,600 MW, approximately 10% of the national electricity demand.
Demands from cogeneration plants
ACOGEN hopes that the Renove Plan will be implemented in the coming months, as set out in Law 24/2013 of the Electricity Sector and in the Non Legislative Motion approved by the Committee on Industry, Energy and Tourism of April 28, 2016 so as to boost energy efficiency and competitiveness, self-consumption, security of supply and distributed generation.
In particular, ACOGEN demands:
– The recovery of a reasonable remuneration regime in the review scheduled for the next three years.
– The indefinite elimination of the self-consumption toll, and the development of the MibGas gas market that has an impact on gas prices in Spain.
– Participating in the energy markets: capacity adjustments in the electricity and gas markets.
– State Pact for Energy that develops a capacity market where cogeneration participates, and new grid tariffs for proximity energy that take into account the origin where it is produced and the destination where it is consumed.
According to ACOGEN, it is all about moving towards a model of distributed generation and greater efficiency.
For the association, the renewal of 2,675 MW of cogeneration for the supply of heat and electricity in 370 industries improves fuel utilization by 20% and reduces residual heat by almost 60%.
In addition, there is a potential efficiency of 3,600 MW through cogeneration that would be reasonable developing in the coming years. According to Virginia Guinda, technical director of ACOGEN, if at least 50% of the new cogeneration plants were developed by 2030, some 250 MW would correspond to industry and 1,550 MW to the tertiary sector.