Electricity companies open a bidding war due to self-consumption boom

The large electricity companies are entering a battle of commercial offers to attract customers in the midst of the self-consumption boom. Endesa and Naturgy follow other large groups such as Iberdrola and Repsol and offer households and companies new tariffs with 'virtual batteries', which allow consumers to save the compensation they receive for the electricity they do not consume and feed into the grid to save on future bills or even on the electricity bills of second homes.

In addition to producing electricity to cover part of the consumption of the home or company where the solar panels are installed, these installations can also inject part of their production into the electricity grid and be compensated for this by reducing the price of the electricity consumed from the grid. The regulation of this more usual surplus compensation only allows reducing the customer's bill by the same amount that the house or company has consumed that month, preventing receiving extra income.

The 'virtual batteries' offered by electricity companies to customers with self-consumption circumvent these limits and allow them to save in a sort of piggy bank the compensation in excess of that set by law, using the balance in future bills by applying deferred discounts. Endesa has been the last of the large electricity companies to launch this type of offer to continue adding self-consumption customers in the midst of business expansion with a specific tariff that has just been launched and which can be subscribed to at no extra cost.

Last month, Naturgy began its entry into the 'virtual battery' business and did so by innovating in relation to the tariffs offered in the Spanish market until now. The group allows customers with self-consumption photovoltaic installations to accumulate the amount of uncompensated energy surpluses as a balance to apply discounts not only on electricity bills, but also on gas bills.

Endesa and Naturgy join other large electricity companies such as Iberdrola and Repsol , which have entered this niche in the last few years, in the midst of the self-consumption boom, and after many independent suppliers had already entered this segment in advance in recent years (such as Holaluz, Próxima Energía, Alterna Solar and, more recently, Factorenergía).

Expansion of self-consumption

Spain has embarked on a historic expansion of self-consumption of electricity. The boom in the sector meant that last year almost as much photovoltaic self-consumption was installed in the Spanish market as in all previous history. In a record 2022, the presence of self-consumption doubled both in number of installations and in accumulated power, with a rampant expansion in both homes and businesses, driven by the very high electricity prices and by the subsidies distributed from European funds.

Last year, renewable energy companies started up installations throughout the country with a total capacity of 2,649 megawatts (MW) for self-consumption of electricity, with 1,625 MW in the industrial sector and another 1,024 MW in the domestic segment, according to data collected in the 1st Annual Report on Photovoltaic Self-consumption prepared by the APPA Renovables employers' association. The boom in the sector allowed self-consumption to double its accumulated power in the Spanish market to 5,211 MW,

The overflowing growth has meant that in Spain there are already more than 298,000 homes and 54,000 companies with solar panels that produce all or part of the electricity they consume to reduce their electricity bills in the midst of the crisis. After the acceleration of 2022, the renewables sector recognizes that this year the deployment of new installations has begun to slow down due to the moderation of electricity prices and the halt in public aid while awaiting the approval of new injections of European funds.