The energy crisis is still there, but it is no longer the wild animal that terrorized Europe last year. In this new context, the president of the Association of Electrical Energy Companies (Aelec, the former Unesa), Marina Serrano (Zaragoza, 1957), believes that the time has come for Spain to take a step forward to take advantage of the advantage that it provided by renewable energies. “More than exporting electricity or hydrogen, what we have to do is take advantage of it to attract industry. It is the challenge that the next Government has and that we all have,” she says on the eve of the annual congress of the electrical employers’ association, which is being held this Wednesday in Madrid. In a long half-hour conversation, Serrano admits that — despite her initial strong criticism — the Iberian exception has managed to contain prices. Hope for a calm winter. And she warns of the need to strengthen the transmission and distribution network to accommodate the new renewable projects on the way.
Ask. The Bank of Spain has just pointed out energy companies, including electricity companies, as the companies that have benefited the most from the price crisis.
Answer. It is a first report on margins, which the Bank of Spain itself says must be taken with caution and that it will improve it. It is based on gross margins and does not take into account the two government intervention measures to contain prices: the reduction and the Iberian exception. It caught our attention, because the CNMC had released a report on supervision of the retail market in May, and said that the marketers had even had negative margins. It does not match.
P. Do you think, then, that the study does not reflect reality?
R. Of course, because it does not take the gross margins, it takes the gas and electricity together, and they do not take into account the effects that the intervention measures have had.
P. It does not consider, then, that the electricity companies have benefited the most from the price crisis.
R. Well, that is something for each company. What I believe is that this photo, which the Bank of Spain itself says should be taken with caution, does not reflect the reality of the margins of the electricity sector.
P. There are several voices, inside and outside the Government, that ask that the extraordinary tax on energy companies become permanent.
R. We have already stated from the beginning that we do not agree with a tax that, unlike the European format, is on sales and not on profits. It is not apropiate. Furthermore, Europe’s model does not apply to electricity companies but to coal, oil and gas companies. We believe that it is not appropriate; that detracts income that could be invested in renewables; that penalizes the competitiveness of Spanish electricity companies with respect to European ones; and that does not coincide with the line of sustainability and decarbonization, in which electrification is the main vector.
P. It does not seem that these criticisms have penetrated society. Even the leader of the PP, Alberto Núñez Feijóo, slipped before the elections that, if he reached the Government, he would not repeal it.
R. Perhaps because it is easier to understand that large companies have to contribute, and not the other reality: that things must be done in accordance with the appropriate tax and fiscal technique, and with what Europe establishes.
P. Aside from the Bank of Spain study, what is clear is that electricity companies have obtained record profits.
R. But we must differentiate between the activity of these companies in Spain and abroad.
P. In most cases, the results in Spain have also been record-breaking.
R. Because we are working on decarbonization objectives, and those results are also used in investments to continue decarbonizing.
P. Why did free market rates rise so quickly during the crisis and why are they falling so slowly now?
R. This is due to the commercial policies of each company.
P. Is there a feather effect and a rocket effect?
R. I don’t know, because I am not a specialist in that matter. It would have to be analyzed; It is a task that corresponds to the regulators.
P. What can be expected for the price of electricity in the remainder of 2023 and 2024? Will it be a quiet winter?
R. In principle, and unless something causes a restriction in the supply of gas, it does not seem that there will be any big surprises. With the data we have, I think the winter could be calm in prices.
P. The electricity companies were very critical of the Iberian exception: when the gas cap was approved, they said it would not reduce the price of electricity. Were they wrong?
R. We have to point out that, indeed, prices fell and this decoupling occurred between the price of electricity and the price of gas. However, distortions also occurred in the market and in exports to France, the use of combined cycles increased and a signal was given against decarbonization and in favor of fossil fuels.
P. In some ways, the facts have refuted these criticisms.
R. Well, the retail market price has gone down. It has worked in relation to that objective, but we believe that we must return to normality and that the interventions should disappear.
P. What do you think of the Government’s new energy roadmap, the so-called PNIEC? There are those who see it as unrealistic.
R. That there is a PNIEC is very good, because it gives a broad, ambitious signal of where we are going in 2030. And it points to electrification as the most important vector to achieve that objective. Now, the specific details are missing to reach those objectives: storage, networks… Which is what is going to make it possible. And it is also necessary to match supply with demand. It is a positive exercise, but one that must be specified.
P. Is it technically possible?
R. Yes, if they make the developments on time. We need to go faster.
P. Is the electrical grid sufficient to accommodate all this volume of renewables?
R. It is a fairly forgotten part, and what worries us most for the development of renewables. The PNIEC recognizes that it is the facilitator of decarbonization, but maintains the same investment as the previous one. The European Commission has already said that there is no decarbonization without an improved electricity grid, and in Europe there is already a feeling that progress must be made in distribution networks, to which 70% of new renewables are going to be connected. You have to make anticipatory investments.
P. Do you feel that in Spain there is little emphasis on the network?
R. Yes. It is a less suggestive topic: it is seen more as a cost of the system, which we try to reduce, when it is essential that the network works to allow all these new uses.
P. How concerned are you about the social response to renewables?
R. It worries me. Sometimes it is difficult to convey to the citizen who is there, in the territory, the role that renewables play in the decarbonization process and the need to replace large (thermal) production plants. You have to talk to them and find solutions.
P. Spain is slower than many European countries in electrification.
R. We already said that the previous PNIEC had a low electrification objective. Now it has increased, but we continue to think that the mechanisms are not established for it to really advance in the industry, in the electric vehicle or in the heat pump, which is talked about much less in Spain. We must advance more than what is being done: it is an absolutely necessary element.
P. Spain is already a net exporter of electricity.
R. I think we are well positioned with respect to Europe and with respect to the change of model (towards renewables). More than exporting electricity or hydrogen, what we have to do is take advantage of it to attract industry: that (manufacturing companies) think that here they have the conditions to produce in a sustainable and decarbonized way. It is the challenge that the next Government has and that we all have. But, again, regulatory stability and a more developed network are needed.
P. A certain slowdown is perceived in self-consumption, after the strong growth last year. Is it temporary?
R. Maybe yes. Our impression is that both the objective of the self-consumption roadmap and that of the PNIEC can be achieved.
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