Tenders / Auctions: Economic Regime for Renewable Energies

• RD 413/2014
• RDL 23/2020
• RD 960/2020
• Order 1116/2020
• Resolution of 10 December 2020 of the State Secretarial for Energy

In November 2020, Spain introduced a new support scheme for RES-E called Economic Regime for Renewable Energies (RD 960/2020). The support scheme shall be allocated through auctions. The first auction round took place in January 2021.
The main objective of the auction is to allocate the new support scheme through a competitive, market-driven mechanism. The lowest bids will receive a premium (sliding feed-in premium - CfD), which results from the awarding price, corrected by a market adjustment percentage that aims to incentivize the participation in the wholesale electricity market. The exact formulas are introduced in RD 960/2020 and Order 1161/2020. The system also encourages to produce and dispatch RE electricity at peak price hours in order to reduce the overall price that consumers pay.
The regulation sets a limit: the maximum delivery period in which successful bidders can perceive the support scheme is between 10 and 15 years, depending on the technology. For exceptional cases, such as technologies with high initial CAPEX, the period can be extended up to 20 years.
Potential bidders can only participate when MITECO calls for auction rounds. It is expected that every year an auction round will take place to comply with the goals set in the NECP (Order 1161/2020).
This support scheme is not compatible with the former “Specific Remuneration Scheme” (RD 413/2014) nor with aid granted for the same purpose or linked to the same investment.

Installed capacity

Sliding feed-in premium (also called Contracts for Difference – CfD)

The first round under the new auction scheme was opened to developers of installations for the production of electricity from RE sources, cogeneration and waste of multiple technologies. These installations can be new ones but also and extension or modification of an existing installation.
In this first auction round, only developers of installations located in the mainland electricity system were allowed to participate (Resolution of 10 December 2020 of the State Secretarial for Energy).

RES-E producers who want to get the support shall participate in one of the auction rounds organized by the authorities. The auction has three stages: pre-qualification, qualification and the auction itself (RD 960/2020, Order 1116/2020, and Resolution of 10 December 2020 of the State Secretarial for Energy).
In the pre-qualification stage, interested project developers shall submit an online request to the authority managing the auction (OMIE). Once pre-qualified, they will have the right to receive information regarding the auction, to participate in informative sessions and to be qualified in a later stage. If the pre-qualified party is interested in the auction, it shall submit a qualification request. Only qualified parties will be able to participate as bidders in the auction stage. Bidders must constitute an economic guarantee of 60 €/kW for the power for which they intend to bid.
Bids will then be ranked and the lowest bids will be awarded with the right to receive the support scheme. To perceive the support scheme the project needs to be realized by the indicated realization period, which varies with each technology. For instance, PV projects participating in the tender from January 2021 shall be fulfilled by 28.02.2023.
The awarded installations shall be registered under the Electronic Registry of the Economic Regime of Renewable Energies.
Before each auction round, the MITECO will publish an Order indicating further details on the requisites to participate and procedures to follow.

• MITECO
• OMIE
• CNMC