BMI View: We maintain our muted outlook for the Spanish renewables sector this quarter, with investor confidence set to remain weak due to regulatory uncertainty from retroactive subsidy cuts and increasingly stringent sector regulation. The government attempt to unlock growth through more sustainable auctioning system will only have a l imited impact, as only 700 megawatts of capacity is to be on offer in the first auction, and an auction timeframe has yet to surface. We therefore expect the country's renewables giants, such as Iberdrola and Gamesa, to look elsewhere for growth opportunities.
|e/f = BMI estimate/forecast. Source: National sources, BMI|
|Generation, Non-Hydropower Renewables, TWh||67.573||68.048||68.763||69.373||69.789||70.352||71.120|
|Generation, Non-Hydropower Renewables, % y-o-y||0.538||0.704||1.051||0.887||0.599||0.806||1.091|
|Capacity, Non-Hydroelectric Renewables, MW||30,891.4||31,023.1||31,419.4||31,738.8||31,869.5||32,036.0||32,246.1|
|Capacity, Non-Hydroelectric Renewables, % y-o-y||0.1||0.4||1.3||1.0||0.4||0.5||0.7|
Latest Updates And Structural Trends
Spain will hold general elections on December 20 2015. We believe the election will herald the start of an era of coalition politics, as no party at the time of writing holds anything close to a majority in the election polls. Given that the Spanish opposition parties all aim to alter the renewables reforms implemented by the current People's Party majority government, we believe a coalition government would mean that some compromises will have to be made over renewables policy.
Spain's renewable energy industry is one of the most developed in Europe, and total installed renewables capacity stands at nearly 31.7 gigawatts (GW, BMI 2015 forecast) - the third highest in Western Europe after Germany and Italy. Additionally, the contribution made by non-hydro renewable electricity to Spain's total power mix is substantial (roughly 25%), but this amount fluctuates on a monthly basis, depending on climatic conditions, power demand and thermal power output.
Following a broader European trend, we expect Spanish power consumption to remain relatively stagnant over our 10-year forecast period. While we have upwardly revised our 2015 electricity consumption forecast for Spain on the back of an uptick in economic growth, with an average annual growth rate of 1.3% forecast between 2015 and 2017, we expect electricity consumption growth to remain relatively muted after 2017, with an annual average growth rate of 0.7% until 2024. Given excess Spanish power generation capacity, the growth potential for new power capacity will be curbed over the next decade.
The Spain Renewables Report researched at source contains BMI Research's assessment of the current renewables market in Spain. The report also contains historical data together with forecasts to end-2018 covering electricity generation (TWh) and electricity capacity (MW).
The renewables sectors covered in the report include Wind, Solar, Geothermal, Tidal and Wave, and Biomass (See Table of Contents for exact coverage). The report also features details on government green energy agendas and funding opportunities, as well as presenting a detailed list of key renewables projects currently being planned or undertaken in Spain, their capacity, the timeframe of construction and their current status.
The report discusses the various energy policies currently in force, including targets, subsidies and the relevant infrastructure developments or limitations which might impact on renewables growth, analysing the potential effects of regulatory changes in conjunction with the background macroeconomic outlook. Finally, there is a general overview of the competitive landscape in Spain, together with a detailed summary of the main utilities and manufacturers present and their business operations.
BMI's Spain Renewables Report provides industry professionals and strategists, sector analysts, investors, trade associations and regulatory bodies with unique independent forecasts and competitive intelligence on the Spain renewables industry.
- Benchmark BMI's independent renewables industry forecasts for Spain to test other views - a key input for successful budgeting and planning in the renewables market.
- Target business opportunities and risks in the Spain renewables sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in the country.
BMI Industry View
Summary of BMI's key industry forecasts, views and trend analysis covering the renewables market in Spain, regulatory changes, major investments and projects and significant multinational and national company developments.
Industry SWOT Analysis
Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the renewables sector and within the broader political, economic and business environment.
BMI Industry Forecasts
Historic data series (2010-2012) and forecasts to end-2018 for electricity generation (TWh) and electricity generating capacity (MW) for each individual renewables sector present in the country.
These in turn are broken down into:
Electricity Generation: Overall capacity (TWh), growth % change year-on-year, KWh per capita, % of Total Non-Hydropower renewables generation, % of total electricity generation.
Electricity Capacity: Overall capacity (MW), growth % change year-on-year, % of non-hydroelectric renewables capacity and % of total capacity.
These forecasts are in turn supported by explicit assumptions, in conjunction with analysis of the key risks to the main forecast.
Business Environment Rankings
BMI's Renewables Business Environment Rankings provide fully comparable Risk-Reward Rankings aimed at investors in the regional renewables market.
The rankings methodology makes sophisticated use of various industry, economic and demographic data point.