The energy companies prepare the green transition with 50,000 million investment | Companies

The year 2021 promises to give the definitive boost to the take-off of renewables in Spain and the large energy companies have already advanced billion-dollar investments for the coming years with the aim of positioning themselves in the race for a booming business. In this way, Iberdrola, Endesa, Repsol, Red Eléctrica, Enagás and Naturgy have already announced investments of more than 50,000 million euros in their latest strategic plans aimed exclusively at the energy transition. In addition, Naturgy will update its roadmap in early 2021 and will foreseeably launch a commitment to renewables in the line it has maintained in recent years, so the investment volume will be even higher.

And, the Covid-19 pandemic has accelerated the energy transition and has made renewables one of the sectors with the greatest business potential to the point that traditional energy companies that exploited fossil fuels have given a green turn to their strategies.

For their part, the firms that had already been dedicating their portfolio to the generation of clean energy have found the opportunity to expand their business. This is the case of Iberdrola, the company that has been betting the most on emission-free energy has designed a roadmap until 2025 with 75,000 million euros in investments, of which more than half (38,256 million) will be allocated to renewables . This will allow reaching an installed capacity of 60 GW at the end of the period, after reaching 44 GW in 2022, which means doubling its current power 32 GW, giving a great boost to offshore wind technology, with 4 GW at the end of the period .

Iberdrola’s commitment will also allow it to grow in solar photovoltaic, with a forecast of 16 GW installed at the end of the period and to strengthen itself in onshore wind and hydroelectric power, with 26 GW and 14 GW installed in 2025, respectively.

In fact, Iberdrola has one of the largest renewable portfolios in the industry: 70.5 GW distributed by its traditional areas and main technologies: 30.7 GW, photovoltaic; 20.2 GW, offshore wind and 16.3 GW, onshore. Currently, the company is progressing in the construction of 7 GW and would have up to 11 GW under execution in 2025.

The green turn will also be given by Endesa. The company led by José Bogas is determined to launch a € 3.3 billion renewable offensive aimed at increasing the renewable energy generating park so that the company will reach 11,500 MW of solar, wind and hydroelectric power by the end of 2023.

Furthermore, for the first time Endesa advanced in December a vision of its main business objectives for the 2030 horizon. The company foresees investments of 25,000 million between 2021 and 2030 to take advantage, precisely, of the opportunities derived from both the National Integrated Energy Plan and Climate (PNIEC) (the Government’s roadmap to address the energy transition in the next decade) as well as the funds for the post-Covid recovery that will arrive from the EU. In this way, Endesa estimates an investment mega-plan of 25,000 million euros between 2021 and 2030. Of these, 40% will go to increase the renewable generator park to reach more than 18,000 MW, more than 10,000 MW in addition to those operating at the end of 2020.

Oil and gas companies

The turn of the steering wheel towards renewables is more evident in the strategy of the big oil companies that have burst into the electricity sector with force. Repsol has drawn up a plan with which it will reinvent itself from next year and for this it will invest 4,000 million in renewables until 2025 (800 million a year, 300% more than in the previous plan) and reducing investment in (exploration and production ) with the intention of being a CO2-free company by 2050.

For their part, gas companies will also bet on the generation of low emissions. Naturgy expected to triple its renewable installed capacity at the end of its 2018-2022 strategic plan. According to the accounts of the company chaired by Francisco Reynés, at the end of 2018 it had an emission-free installed capacity of 4,300 MW, which means that at the end of the period it should end with 12.8 GW.

Currently, the gas company has new projects under construction for some 1,400 MW in Spain, Chile and Australia and another 3,700 MW is under development and processing. Although Naturgy does not detail the data, market sources estimate an investment of 3.8 billion. In addition, the company delayed until February 2021 the presentation of its new roadmap with more investments after it agreed in November to sell the Chilean subsidiary Compañía General de Electricidad (CGE) for 2,570 million euros.

This operation represents a movement that gives Naturgy the financial capacity to address its commitment to renewable energies within the transformation process that the group is going through. Therefore, in the updated objectives for the horizon of the coming years, it is expected that it will raise even more the figures both in renewable investment and in installed capacity at the end of the same.

Enagás has committed to investing 300 million in hydrogen, biogas and biomethane projects between 2020 and 2026. In fact, from 2021 a race will be fought to develop hydrogen with an investment already announced by the Government until 2023 of 1,500 million.

And it is that, 2021 is positioned as the year of the definitive accolade to renewables in Spain. According to data from Red Eléctrica de España (REE), 2019 (the last full year for which data are available) was a milestone in the transition of the peninsular electricity system, since for the first time green energy surpassed (52%) the rest of technologies in the generating park. In this way, Spain closed the year with a record figure of 104.8 MW renewable.

At the end of 2019, the renewable contingent in the peninsula amounted to a total of 54,457 MW, of which 46% are wind, 16% are photovoltaic and the rest (38%) correspond to other renewable technologies.

First auction, in January

Calendar and deadlines. The first renewable energy auction will be held on January 26, with a total of 3,000 megawatts (MW) at stake for different technologies. The Government authorized the deadline for the documentation of the offer since last December 15, and on January 26, the offers will be submitted.

Technology types. Of the 3,000 MW that will be put into play in the first call in 2021, at least 1,000 MW will go to wind energy and another 1,000 MW to photovoltaic energy, leaving the rest of the power to be auctioned without technological restriction.


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