Alcoa-backed wind projects in Spain get last-minute approval

January 27 (Renewables Now) - Eight wind farm projects contracted by US aluminium producer Alcoa Corp (NYSE:AA) in Spain’s north-western region of Galicia have secured favourable environmental impact assessment (EIA) reports, the regional government said on Wednesday.

Five of these projects are sponsored by Spanish renewables developer Greenalia and three by Enel Green Power Espana, the renewables division of domestic utility group Endesa SA (BME:ELE). Both Greenalia and Endesa signed power purchase agreements (PPAs) with Alcoa to build wind farms in Galicia and feed that electricity on behalf of Alcoa’s San Ciprian smelter in the region.

Galicia’s government said that these eight PPA-backed wind projects amount to 207.4 MW.

The pressure for all sides to get the favourable EIAs out of the regional government’s offices was two-fold. First, the legal deadline to complete the reports expired on January 25, and the government would have likely faced lawsuits had it not met it. Without the EIAs, the wind projects would have lost all grid connection rights and the remainder of the permitting process for them would have ended.

Second, the government would have also had to deal with the San Ciprian workers’ revolt, since those wind PPAs are the lifeline for the currently curtailed smelter. For years, the facility brought no profits due to high electricity prices in Spain so much so that Alcoa considered closing it. After agreeing with the workers, Alcoa paused activities until January 2024 to modernise the plant and negotiate better electricity prices under PPAs.

In Wednesday’s press release, Galicia’s government said that Alcoa now has more choices in signing power contracts for renewables in the region. It said had it also issued favourable EIAs for Enel’s and Greenalia’s other projects that fall outside of the scope of the PPAs with Alcoa.

In addition, Alcoa can contract power from any of the 2,000 MW of renewables that the government greenlit before the January 25 deadline.

Among the favourable EIAs are two for wind projects covered by PPAs between Greenalia and Japanese chemicals company Showa Denko K.K., the regional government said.