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 Electric 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 conferred by renewable energies. "More than exporting electricity or hydrogen, what we have to do is to take advantage to attract industry. This is the challenge for the next government and for all of us," he said on the eve of the annual congress of the electricity employers' association, which is being held this Wednesday in Madrid. In a half-hour long conversation, Serrano admits that -despite his initial strong criticism- the Iberian exception has managed to contain prices. He is confident of a calm winter. And he warns of the need to strengthen the transmission and distribution grid to accommodate new renewable projects on the way.
Question. The Bank of Spain has just pointed to energy companies, including electricity companies, as the ones that have benefited the most from the price crisis.
Answer. It is a first report on margins, which the Bank of Spain itself says should be taken with caution and that it is going to 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 has caught our attention, because the CNMC had issued a report in May on the supervision of the retail market, and it said that the marketers had even had negative margins. It does not coincide.
Q. Do you think, then, that the study does not reflect reality?
R. Of course, because it does not take gross margins, it takes gas and electricity together, and does not take into account the effects that the intervention measures have had.
P. You do not consider, then, that the electricity companies have benefited the most from the price crisis.
R. Well, that is a matter for each company. What I think is that this picture, 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 are calling for the extraordinary tax on energy companies to become permanent.
R. We have already stated from the beginning that we do not agree with a tax that, unlike the European format, is levied on sales and not on profits. It is not appropriate. Moreover, the European model does not apply to electricity companies but to coal, oil and gas companies. We believe that it is not appropriate; that it detracts income that could be invested in renewables; that it penalizes the competitiveness of Spanish electricity companies with respect to European ones; and that it 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 permeated society. Even the leader of the PP, Alberto Núñez Feijóo, said before the elections that, if he came to the Government, he would not repeal it.
R. Maybe because it is easier to understand that big companies have to contribute, and not the other reality: that things must be done in accordance with the appropriate taxation and fiscal technique, and with what Europe establishes.
P. Apart from the Bank of Spain's study, what is clear is that the electricity companies have obtained record profits.
R. But it is necessary to differentiate between the activity of these companies in Spain and abroad.
P. In most cases, the results in Spain have also been record.
R. Because we are working on the decarbonization objectives, and these results are also used in investments to continue decarbonizing.
Q. Why did free market tariffs rise so fast during the crisis and why are they falling so slowly now?
R. That is due to the commercial policies of each company.
Q. Is there a featherbedding effect and a rocket effect?
R. I don't know, because I am not a specialist in this matter. It would have to be analyzed; that is a job for the regulators.
Q. What can we expect for the price of electricity for the rest of 2023 and 2024? Will it be a quiet winter?
R. In principle, and unless there is something that causes a restriction in the gas supply, it does not seem that there are going to be big surprises. With the data we have, I think the winter could be quiet in terms of 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 went down and there was a decoupling between the price of electricity and the price of gas. However, there were also distortions 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 disproved these criticisms.
R. Well, the retail market price has come down. It has worked in relation to that objective, but we believe that we should go back to business as usual and that the interventions should disappear.
Q. What do you think of the Government's new energy roadmap, the so-called PNIEC? Some people see it as unrealistic.
R. The fact 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 for achieving that goal. However, the specific details are lacking to achieve these objectives: storage, grids... This is what will make it possible. And it is also necessary to match supply with demand. It is a positive exercise, but one that needs to be specified.
Q. Is it technically possible?
R. Yes, if the developments are made on time. We need to go faster.
Q. Is the electric grid sufficient to accommodate all this volume of renewables?
R. It is a rather forgotten part, and what worries us most for the development of renewables. The PNIEC recognizes that it is the facilitator of decarbonization, but it 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 the distribution networks, to which 70% of the new renewables are going to be connected. We have to make investments in anticipation.
Q. Do you feel that in Spain there is hardly any emphasis on the grid?
R. Yes. It is a less suggestive subject: it is seen more as a cost of the system, which we try to reduce, when it is essential that the grid works to allow all these new uses.
Q. How much are you concerned about the social protest against renewables?
R. It worries me. Sometimes it is difficult to convey to the citizens who are there, in the territory, the role that renewables play in the decarbonization process and the need to replace large [thermal] production plants. We have to talk to them and look for solutions.
More informationThe nine hours in which Spain made the 100% renewable dream come true.
P. Spain is slower than many European countries in electrification.
R. We already said that the previous PNIEC had a low electrification target. Now it has increased, but we still think that the mechanisms are not established to make real progress in industry, in electric vehicles or in heat pumps, which are much less talked about in Spain. More progress needs to be made than is being made: 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 to take advantage of this to attract industry: that [manufacturing companies] think that here they have the conditions to produce in a sustainable and decarbonized way. This is the challenge for the next government and for all of us. But, again, we need regulatory stability and a more developed network.
P. There is a certain slowdown in self-consumption, after last year's strong growth. Is it temporary?
R. Maybe it is. Our impression is that both the objective of the self-consumption roadmap and that of the PNIEC can be achieved.
Follow all the information from Economía y Negocios on Facebook and Twitter, or in our weekly newsletter.