The Ministry for Ecological Transition and the Demographic Challenge, through the Institute for Energy Diversification and Saving (IDAE) , has launched a new set of incentives aimed at accelerating the deployment of heating and cooling networks based exclusively on renewable energy sources in Spain. This is the second call for proposals under the Renored program , a support initiative that seeks to transform how residential buildings and public infrastructure are heated and cooled.
With a budget of €50 million from the Recovery, Transformation and Resilience Plan (PRTR) and financed by European funds through NextGenerationEU , the call for proposals targets projects that reduce the use of fossil fuels and lower greenhouse gas emissions related to heating and cooling. The government aims to promote more efficient collective heating networks, aligned with the climate and energy objectives set at the national and EU levels.
A decisive boost to renewable heating and cooling networks
District heating and cooling networks allow for the supply of thermal energy from one or more generating stations to multiple connected buildings . This approach, widespread in northern and central European countries, facilitates the use of local renewable energy sources and high-efficiency technologies, reducing losses and simplifying energy management compared to individual equipment in each building.
In Spain, the implementation of this type of infrastructure has progressed more slowly, partly due to the high initial investments required and the complexity of coordinating multiple stakeholders (municipalities, energy companies, homeowners' associations, public facility managers, etc.). The Renored program's subsidies aim precisely to lower this economic barrier to entry and boost projects that, without public support, would struggle to get off the ground in the short term.
The Ministry frames this second call for proposals within a broader strategy to decarbonize the heating sector , an area that typically receives less media attention than the electricity sector, but which accounts for a very significant portion of national energy consumption. Heating and cooling homes, service buildings, and public facilities still represents a large demand for fossil fuels, especially natural gas and petroleum products.
According to information released by the department headed by Sara Aagesen, the goal is for the newly funded heating and cooling networks to operate entirely on renewable energy sources , prohibiting the use of fossil fuels at any point in the network. With this approach, the program is geared towards long-term solutions that contribute to climate neutrality.
Funding and deadline for submitting applications
The second Renored call for proposals mobilizes €50 million from the PRTR , within the framework of component 31, which focuses on the deployment of renewable energies and the improvement of energy efficiency. These resources are in addition to those already committed in the first edition of the program and reinforce the role of renewable thermal networks as a tool for the energy transition.
The application period is set between 9:00 a.m. on January 21, 2026, and 13:00 p.m. on February 27 of the same year . All applications must be submitted electronically through the online system available on the IDAE's grants portal . The application process is open to both public and private entities interested in developing projects that meet the established criteria.
The grants will be awarded on a competitive basis , meaning they will not be granted on a first-come, first-served basis, but rather according to the scores obtained based on the evaluation criteria defined in the call for proposals. This system aims to prioritize initiatives with the greatest energy, environmental, and socioeconomic impact, and to ensure the efficient use of available funds.
Once the call for proposals is resolved, the selected beneficiaries will have a clearly defined timeline, since the actions must be fully completed and operational before June 30, 2029. This timeframe allows for the planning of fairly large-scale projects, but also requires good organization from the initial stages.
Eligible actions and minimum power required
The aid is aimed at a wide range of investments related to heating and cooling networks powered exclusively by renewable energy . Eligible projects include, primarily:
- New thermal power plants that supply heat and/or cold to a distribution network.
- Distribution networks associated with these power plants, including pipelines, exchange substations and other elements necessary to bring energy to the points of consumption.
- Expansions of existing infrastructure, both in terms of generation capacity and network expansion to connect new users.
In all cases, a common requirement is established: projects must have a minimum capacity of one megawatt (1 MW) . This threshold aims to focus funds on projects of sufficient scale to generate a noticeable impact on reducing emissions and improving energy efficiency in their surroundings.
Furthermore, the financed networks must serve multiple buildings or facilities , whether residential, commercial, or publicly owned, thus ensuring collective use of the infrastructure. The network design, therefore, must consider a critical mass of thermal demand that justifies the investment and ensures its operational viability over time.
Permitted renewable energy sources and exclusion of fossil fuels
One of the key aspects of the call for proposals is the requirement to use only renewable energy sources throughout the heating and cooling network. Among the eligible technologies, the following are highlighted:
- Biomass, in its various forms (wood chips, pellets, forest waste, agricultural by-products, etc.), provided that the sustainability and fuel quality standards are met.
- Geothermal, both low and medium enthalpy, through systems that take advantage of the heat from the subsoil to generate heating and cooling.
- Concentrating solar or solar thermal, in projects that capture solar radiation to produce thermal energy in a centralized manner.
In practice, the range can be expanded to include other renewable solutions, provided they meet the applicable technical and regulatory requirements and are integrated into a collective network. What is expressly prohibited, however, is the use of fossil fuels at any point in the system, whether as support or backup, in the generation plant, distribution network, or substations.
This restrictive approach reinforces the fully decarbonized nature of the subsidized infrastructure. Unlike other programs that allow combinations of renewable and conventional technologies, Renored is committed to networks that are designed from the outset to be climate-neutral, without intermediate phases relying on gas or petroleum products.
Technical and regulatory requirements of projects
In addition to the conditions regarding power and energy sources, the projects must comply with a series of technical and regulatory requirements designed to guarantee their efficiency, safety, and environmental traceability. Among the most relevant requirements are the following:
- employment of equipment with energy labelingThis allows us to identify its level of efficiency and ensure adequate performance.
- Application of the best available technology in each case, avoiding obsolete or low-performing solutions.
- Installation of energy and environmental monitoring systems, that facilitate the monitoring of consumption, network performance and its environmental impact.
- Compliance with the requirements of Regulation of Thermal Installations in Buildings (RITE) where applicable, both at the central plant and in the connections to the supplied buildings.
These conditions aim to ensure that the financed infrastructure is not only renewable in terms of energy source, but also technically robust and compliant with current regulations . Monitoring, in particular, will provide objective data on the actual performance of the networks and their contribution to emissions reduction.
The requirement that the facilities be fully completed before June 30, 2029, also necessitates careful planning of the design, administrative procedures, construction, and commissioning phases. Any significant delays could jeopardize meeting the deadlines and, consequently, access to the awarded funding.
Call structure: two separate programs
To tailor support to the nature of the different potential beneficiaries, the Renored call is structured into two distinct programs :
- Program 1: geared towards beneficiaries who develop economic activity, with a staff of 40 millones de euros.
- Program 2: aimed at sectors without economic activity (for example, certain public administrations or non-profit organizations), endowed with 10 millones de euros.
This separation allows for adjusting the intensity of aid and applicable limits according to the type of entity and the current state aid framework. Companies, for example, are usually subject to specific rules on competition and state aid , while entities with no economic activity may have greater leeway to receive non-repayable funding.
In both cases, the call for proposals stipulates that the grants will be awarded as non-refundable subsidies , although conditional upon meeting the objectives and the proper execution of the investments. This reduces the initial financial burden on the promoters and facilitates the viability of projects with a strong public interest component.
Intensity of aid, economic limits and territorial bonuses
The level of assistance varies depending on the program and the type of beneficiary. Generally, the expected percentages are as follows:
- For 1 program (economic activity), a basic allowance is set for 35% of the eligible investment.
- For 2 program (sectors without economic activity), the intensity reaches 70% of the eligible costs.
Several additional increases are applied to these percentages , aimed at favoring certain beneficiary profiles and locations:
- small companies They can get an extra 10% on top of the level of assistance they are entitled to.
- medium businesses They have an additional 5% increase.
- The projects located in municipalities facing demographic challenges and/or undergoing a just transition They can add an additional 5%.
In this way, a project well-suited to program 2 and located in a priority municipality could achieve very high levels of funding, thus facilitating the viability of initiatives in areas with less investment capacity. This approach introduces a territorial and social dimension to aid policy, linking it to the fight against rural depopulation and the revitalization of areas affected by the closure of fossil fuel facilities.
In parallel, several financial limits are established to ensure a balanced distribution of funds: each project and beneficiary cannot receive more than €15 million in aid , and a minimum investment of €450.000 is required to participate. These thresholds aim to prevent both excessively small projects and initiatives that, due to their size, could consume a disproportionate share of the available budget.
Project evaluation and selection criteria
The grants will be awarded through a competitive process , in which only the highest-scoring applications will be selected. The evaluation criteria combine economic, business, territorial, and social variables, with the following approximate weighting:
- Economic criteria (70% of the score): aspects such as the cost efficiency of the investment, the relationship between the aid requested and the renewable energy to be supplied, and other indicators of profitability and resource optimization are analyzed.
- Size of the company (10%): the aim is to encourage the participation of SMEs, which often have more difficulty accessing financing for large projects.
- Location in municipalities facing demographic challenges or undergoing a just transition (10%): It is positively valued that the network contributes to the reactivation of these areas.
- Supplying heat to vulnerable neighborhoods (10%): the social impact of the actions and their capacity to alleviate situations of energy poverty are enhanced.
This scoring system reflects the commitment to reconcile economic efficiency with social and territorial cohesion objectives . It is not enough for a project to be energy-efficient; it also rewards projects that reach vulnerable groups and areas with particular demographic or employment challenges.
Once the applications have been reviewed and the call for proposals resolved, the beneficiaries will receive the final funding after verification of project implementation and certification of the investments made . The regulations establish control mechanisms to verify that the actions have been carried out in accordance with the commitments made and the documentation submitted with the application.
Payments, advances and conditions for collecting aid
The financial design of the call for proposals stipulates that the grants will be non-refundable , but contingent upon strict compliance with the technical, economic, and deadline conditions. The main payment will be made once IDAE has verified that the facilities are completed, operational, and compliant with the established requirements.
To facilitate the execution of large-scale projects, the call for proposals allows for advance payments of up to 80% of the awarded amount . These advances can be crucial for companies and organizations that would otherwise struggle to cover the full investment until receiving the final grant.
The possibility of advance payments is, however, accompanied by obligations regarding justification and guarantees in accordance with European fund management regulations. This aims to strike a balance between providing liquidity to projects and ensuring the proper use of public resources, especially when dealing with funding from NextGenerationEU.
In any case, the final payment is contingent upon certification that the network meets the requirements for power, renewable energy sources, monitoring, and deadlines , as well as the proper documentation of eligible costs. Significant non-compliance could result in full or partial repayment of the aid.
Alignment with the 2023-2030 National Integrated Energy and Climate Plan (PNIEC) and climate objectives
The second Renored call for proposals is integrated into component 31 of the PRTR and is directly aligned with the objectives of the Integrated National Energy and Climate Plan (PNIEC) 2023-2030 . This plan sets ambitious targets for renewable energy penetration, emissions reduction, and improved energy efficiency, with particular attention to the building sector and public services.
The development of renewable heating and cooling networks contributes to a gradual reduction in the energy demand of buildings by optimizing energy use and enabling the incorporation of advanced technologies. Furthermore, these infrastructures help to decrease dependence on imported fossil fuels, strengthening the country's security of supply and energy independence.
Another important aspect is the promotion of high-efficiency technologies and collective self-consumption solutions , especially when networks are integrated with local renewable energy installations (for example, utilizing locally produced biomass or geothermal resources available in the area). This also boosts the local economy linked to forest management, energy services, and infrastructure maintenance.
Overall, the program is configured as one more piece within a broader puzzle of measures aimed at climate neutrality in the medium term , in line with European strategies and international commitments on climate change.
Experience from the first call for proposals and the role of biomass
The current edition of Renored is backed by the experience gained in the first call for proposals , in which €34 million was awarded to 20 projects . That round of funding was concentrated especially in autonomous communities such as Catalonia, Castile and León, and Castile-La Mancha , where several district heating networks with a strong renewable energy component were developed.
In that initial phase, biomass became the dominant technology , taking advantage of the availability of forest and agricultural resources in many rural and peri-urban areas. Biomass boilers for district heating networks have proven to be a mature and relatively competitive solution, especially when integrated with efficient fuel supply logistics and when the sustainability of forest stands is ensured.
This second call for proposals opens the door to consolidating and diversifying the model, also giving space to projects that focus on geothermal energy, large-scale solar thermal energy, or other emerging renewable technologies. Combining different sources and integrating them with thermal storage systems can allow for more flexible networks adapted to the specific characteristics of each region.
The results of the first edition suggest that the grants have acted as a catalyst for projects that would otherwise have taken longer to materialize . The continuation of the program with this new call for proposals indicates that the Government considers these infrastructures a strategic element in the energy transition, especially in areas with high thermal demand.
With this complex framework of conditions, economic incentives, and results-oriented approach, the second call for proposals for renewable heating and cooling networks under the Renored program is shaping up to be a significant opportunity for municipalities, energy service companies, and public and private entities seeking to invest in decarbonized collective heating and cooling infrastructure . The initiative's success will largely depend on the promoters' ability to design technically sound, socially beneficial projects that align with the timelines set by the PRTR and the PNIEC.