Spain has allocated 3.034 GW of renewable energy capacity in its first renewable energy auction since 2017.

In the auction held by the Ministry for the Ecological Transition, 2.034 GW of solar photovoltaic capacity was awarded.  Spanish solar developer X-Elio Energy won 315 MW of solar capacity, followed by Iberdrola subsidiary Iberenova Promociones (243 MW) and Spanish utility Naturgy (196 MW).

Ignis Dessarrollo offered the lowest bid of €14.89 (~$18.03)/MWh or €0.01489 (~$0.018)/kWh for 30 MW of solar capacity.  Enel Green Power Espana submitted the highest bid of €28.90 (~$35)/MWh for 50 MW solar capacity. The average bid price for solar energy stood at €24.47 (~$29.63)/MWh.

The Ministry also auctioned 998 MW of wind energy capacity. The lowest bid for the wind energy stood at €20 (~$24.22)/MWh, while the highest bid was €28.89 (~$34.99)/MWh. The average bid price for wind power was €25.31(~30.64)/MWh.

Bids were received for a total of 9.7 GW of renewable capacity against the 3 GW tender. The auction was designed as a ‘pay as bid model’ to award 1 GW of each solar and wind capacity and another 1 GW for any other technology.

The successful bidders have to complete the solar projects by February 2023 and wind projects by February 2024.

EDP Renováveis, a Portugal-based renewable energy company, said that it had secured a portfolio of six solar and wind projects with a total capacity of 143 MW in the auction.

Solaria, a Spain-based electric services company, bagged 180 MW of solar capacity in the auction. It also had a power purchase agreement (PPA) at a tariff of €27.97 (~33.83)/MWh for 12 years, with supply starting in 2023.

In September 2020, The Institute for the Diversification and Saving of Energy intended to allocate €181 million (~$214 million) to support renewable energy projects in seven autonomous communities of Spain. The allocation was part of a €316 million (~$375 million) package for the domestic renewable energy sector.

According to a report by Wood Mackenzie, solar is the cheapest form of energy in Spain, besides Italy and India. Solar energy will become the lowest-cost source to generate power in the United States, Canada, China, and 14 other nations by 2030.