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Spain Photovoltaic technology status and prospects Javier Sanz, Centro Nacional de Energias Renovable, CENER |
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The development achieved throughout 2005 has proven that the introduction of a
new legal support system for renewable energy sources, as covered in the Royal
Decree 426/2004, which came into force in March last year, is the right approach
in order to boost the market growth. Nowadays, all PV investors have the perception
that a reasonable profitability is achievable.
The deployment of installed capacity, in accordance with ASIF figures, reached 10 MW in 2004 and, although official figures are not yet available, 2005 will go far beyond last year. This growth has permitted that overall costs continued on lowering, despite some subcomponents which were increasing their prices. It is considered that the cost of new facilities has gone down around 5 %.
The other interesting effect of the new legal framework is that the average size of facilities is continuously increasing. And the obvious consequence is that the size of the investment is growing, as well. Venture capital funds and financial entities are looking with interest at the new business.
For 2006, the value of TMR (reference cost of the energy calculated as a projection of the whole year costs) has been increased by 4,8 % when compare to that of 2005. This will balance the increase in interest rates that was menacing future activities.
It is worth noting that the objective of the old “Plan de Fomento de las Energias Renovables (PFER),” approved in December 1999, was to have 135 MW installed between the years 2000 and 2010. In August 2005, the government approved a revised version that has increased the target well above 400 MW.
On top of all these regulation activities, the direct support for investments is still being provided, both through IDAE (the Spanish Institute for Diversification and Energy Savings) and through some regional authorities.
However, the present tendency is showing that the investors do not rely on direct support for investments, as the feed-in tariffs scheme is sufficient enough to make the business a reality. Experience has shown that subsidies to investments create much bureaucracy and are quite complicated and time consuming. Experience is also showing that a feed-in tariff system should be sufficient to give the necessary support to grid-connected photovoltaic power systems (PV). Of course this is not the case for isolated systems, for which direct support for investments is necessary.
The public perception of PV in Spain continues to be very positive, due to its environmental advantages, although high costs are still hurting market development. The new approach seems to be a step in the right direction.
Nevertheless, there are still some problems to be solved. One of them is the bureaucratic approval process that involves many different agents such as local and central governments, utilities, system operators and control authorities (environmental, industrial, etc.). Extremely long approval processes can kill many initiatives and in any case, seriously affect the business situation.
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Other activities are related to satisfy the necessities of the Spanish PV industry related to certification of new products and components, creation of new standards and methodologies for validation and analysis of new PV systems, and improvement of services related to the entire PV chain.
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The Spanish PV industry has made a considerable effort in investments during the past few years. From January 1999 to October 2005 the cumulative investments of the PV sector (including both manufacturers and installers) reached 290 MEUR.
The total workforce reached 4 195 for direct employment in October 2005; of which 1 895 correspond to manufacturers of cells and modules, and approximately 1 200 to installers. The corresponding total figure by the end of 2004 was 3 700, and the difference consistently reflects the strong impulse that the PV Spanish industry is experiencing as a result of the new support scheme. Furthermore, there are another 2 197 who are indirectly employed by the industry. Therefore, the total workforce related to the Spanish PV industry can be estimated to have reached a total of 6 292.
The perspectives for the immediate future are optimistic. The public perception of PV is more and more favourable, and the support mechanisms seem to be working adequately. In the past, and due to the limitation of size of 5 kW, many “solar farms” were created (installations of, approximately, 100 kW with several owners, none of them owning more than 5 kW, and promoted by a unique body, in charge of connection and maintenance services). The number of these farms is being increased, since the limitation of 5 kW no longer exists, and there is a growing public consciousness of PV power plants economic profitability.
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