Spain, like many other countries, faces a crucial challenge: to become fully part of the energy transition and gradually eliminate dependence on Fossil fuelsHowever, progress towards this goal has been uneven, and recent governments have not shown a firm commitment to reducing these energy sources. Since the PSOE's mandate ended in 2008, the Popular Party (PP), under the leadership of Mariano Rajoy, has led the government with an energy policy that has been the subject of constant criticism for the lack of support for renewable energy.
The influence of fossil fuel subsidies
The main problem lies in the fossil fuel subsidiesAccording to the Institute for Energy Economics and Financial Analysis (IEEFA), these subsidies, granted mainly to coal and gas plants through the so-called capacity payments, have proven to be excessively expensive. These payments ensure that thermal plants that use fossil fuels remain operational as a backup for the electricity system when renewable energies are not sufficient to cover energy demand. According to this institution, the cost of these subsidies amounts to around 1.000 million euros per year, which has been highlighted as clear evidence that the country continues to bet on conventional energy production methods.
The mechanism of capacity payments
The capacity payments were established in Spain in 1997 and, in simple terms, their aim is to ensure a constant electricity supply. When renewable energy sources are insufficient or unavailable, thermal plants using renewable energy are used to generate electricity. carbon o gas natural They provide the necessary energy. However, this scheme has been criticised for perpetuating the dependence on fossil fuels. These plants receive subsidies simply for being available, which discourages modernisation of the energy system in favour of cleaner sources such as solar or wind.
Some experts propose alternatives to capacity payments, such as the implementation of a system of Auctions, where factors such as energy interconnection capacity or the use of storage batteries can compete more fairly to meet demand when there is not enough renewable generation.
The need for a more transparent market
The report from the Institute for Energy Economics also stresses that it is essential to have a more transparent electricity market and a more autonomous regulatory body. This body should be tasked with providing clearer and more accurate signals on electricity prices, which currently do not adequately reflect the real costs of the system, especially when externalities such as environmental and health effects are considered.
Spain's commitment to renewable energy
Despite justified criticism of the slow progress in the energy transition, Spain has made concrete commitments regarding the use of renewable energy. According to international treaties and EU policies, the country has committed to ensuring that the 27% of energy demand be covered by renewable energies by 2030 and, in the short term, reach 20% by 2020. However, for 2020, renewable energy consumption remains stagnant at 17,3%. Although some progress has been made, the challenge remains immense.
Current policies do not seem to be fully aligned with these objectives. Legal facilities and financial support for the fossil fuel sector continue to far outweigh support for renewables, making it necessary to completely reconsider the Spanish regulatory framework.
Improvement proposals
According to an IMF report, eliminating fossil fuel subsidies to redirect those funds to clean sources is crucial not only to combat climate change, climate change but to ensure a more sustainable economic future. In 2022, global fossil fuel subsidies were estimated to have amounted to seven trillion dollars (approximately 6,5 trillion euros), representing 7,1% of global GDP.
The effects of climate change, such as extreme heat waves or devastating forest fires, are clear evidence of the urgency of change. The use of subsidies on fossil fuels only perpetuates these problems. Therefore, in order to move towards a more modern energy model, the review of support schemes for coal, oil and natural gas is an indispensable step.
Finally, the IMF's recommendation to impose corrective taxes, such as a tax on carbon dioxide, which would allow emissions of this gas to be reduced by 34% by 2030, bringing with it an alignment with the objectives of the Paris Agreement.
Spain and aid to fossil fuels
At the national level, Spain continues to allocate aid to fossil fuels. According to the IMF, in 2022 the country granted 11.500 billion dollars in subsidies, a figure that, although lower than the 17.900 billion in 2020, is still considerably high. The challenge lies mainly in implicit subsidies, which are not reflected in the prices of these fuels and which encourage their consumption.
Proposals for action
- Adopt an auction-based approach to maximize the participation of cleaner and more competitive technologies.
- Redirect subsidies towards the development of renewable infrastructure to reduce dependence on gas and coal.
- Encourage electrification and the use of storage batteries to ensure the security of the electricity supply.
With an integrated approach, Spain could effectively accelerate the energy transition and meet its international commitments.