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19 December 2019

Spain announce huge renewables deals to replace coal plants

By Andries Wantenaar

At the COP25 Summit in Madrid, Endesa’s CEO Jos Bogas announced two renewable energy projects, one of them gigawatt-scale and with a 160 MW battery system, to compensate for the closure of two of its five coal plants in Spain. The decision is motivated by a variety of EU regulations and directives, including rising C02 taxes, additional environmental upgrades required for coal plants, and the closure in 2018 of 26 unprofitable Spanish coal mines.

Endesa is a Spanish subsidiary of Enel, and with the closure of the Compostillas and Teruel coal plants, it will only retain three coal plants in Spain, totalling 3 GW. Those plants will also close by 2025, and Endesa’s coal plants already produced only half the power in first half 2019 compared to first half 2018. Endesa’s current renewable assets in the country total 1.675 GW.

In the town of Andorra in Spain’s Teruel province, a 1050 MW lignite plant operational since 1979-1980 will be closed, and a 1.7 GW renewable project will be built in its stead by 2024, in accordance with Endesa’s ‘Futuro para Andorra’ plan. The project will feature 1585 MW of solar power, 139 MW of wind, and a 160 MW energy storage system, at an overall cost of $1.65 billion. Because of the proximity of the sites, there will be some degree of co-ordination between decommissioning and commissioning work.

In Compostillas, Leon, the currently 1030 MW, originally 1312 MW Compostillas anthracite and bituminous coal plant will be fully closed, with two 141 MW units having been closed already in 2008 and 2016. The plant has been operational since 1961 and reached its current size in 1984. In its place, Endesa plans a 390 MW renewables project at a cost of $341 million. The finer details of that project are unspecified, but it will likely be all or mostly solar, plus battery. Endesa has recently been considering a plan for 300MW solar and 20MW wind in the nearby Villameca area. It is also considering moving its primary wind farm warehouse to the site of the decommissioned coal plant.

Both Iberdrola and Naturgy have similar plans to close their coal plants in Spain and develop renewable plants to replace them. Naturgy is closing its three coal plants totalling 1.7 GW by June 2020, and their production is reduced until then due to high costs. Iberdrola announced in November 2017 that it intended to close its two Spanish coal plants totalling 874 MW, and has since announced at the COP25 summit plans for 550 MW of replacement renewables in the country’s North for 2022.

In 2017, Spain produced 30% more energy than it consumed, an unnecessarily high margin, and 17.4% of that generation was coal, leaving room for cuts. Currently Spain still gets about 14% of its electricity from coal, relying primarily on imported coal from Russia and Columbia even before the closure of 26 domestic mines last year.

The Spanish government had planned to close its seven nuclear plants by 2035 and its coal plants by 2030, but the rising carbon taxes placed on all carbon, and especially coal generation, by the EU are motivating companies to close many plants a decade earlier. This is true even for the seven plants that rely on cheap imported coal, rather than those which had used coal from the recently closed Spanish mines. A lot of the slack is also being picked up by natural gas generation, which is enjoying low prices and incurs lower environmental penalties due to lower CO2 emissions. Globally, coal generation is predicted to have fallen by 3% in 2019.