Spain vies for pole position in Europe

Spanish authorities are dealing with strategic development plans to bring the country's wind power total to 2000 MW in the next two years, while there is every indication that the country's fast consolidating wind industry has no intention of stopping there.

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Spain moved in to high gear last year, doubling its installed wind power capacity in just over 12 months to reach over 450 MW and introducing plans which could quadruple that total by 2000. The country's much talked about wind power boom would seem to be happening in a really big way. Wind turbines are being erected from Galicia on Spain's far north western corner to Almeria at the opposite extreme in the southeast, not to mention on the Canary Islands off north Africa's west coast. And while more and more wind power developers and component manufacturers are consolidating their grip on the rapidly expanding market, Spain's electrical utility giants appear to have dropped any reticence they might have once harboured about the viability of this renewable energy technology.

The boom is not new. Spain has been a member of the league of nations with the fastest growing wind power development in the world for the past several years. But the big difference today is that whereas the early 1990s drew a bevy of gold diggers to Spain's windswept plains with their sights set on quick capital returns, the business now boasts a consolidated base with plenty of room for responsible and controlled development. This is just the approach which is now favoured by tough central, provincial and local legislation.

Legal requirements today more often than not start in the municipality of the chosen site. Depending on the area, they might include environmental impact studies, local taxes and the requirement to create employment. Next, developers might have to comply with provincial laws and, following these, regulations imposed by the regional government. Then, wind farm proposals of over 25 MW of installed power must comply with special central government authorisation, basically aimed at ensuring the national grid is not overburdened. Adding to these complex legal controls are the so-called strategic development plans, which any developer aiming to establish more than one wind farm in any one region must submit. These envisage the setting up of factories for wind turbines and/or their components in order to create employment for locals.

Powerful marriages

Despite this barrage of bureaucracy, wind development has not suffered, as some analysts initially feared. Several big foreign companies, including NEG Micon, Bonus and Vestas from Denmark, SeaWest of the US and Japan's Tomen, have managed to find a home in Spain -- albeit by marrying into Spanish companies. With the fierce competition that has come hand in hand with these powerful alliances, whole new tracts of land are being opened to wind power development.

Vestas' marriage to Gamesa -- a huge corporation with diverse interests, including aircraft manufacture -- has given both companies a virtual wind power monopoly in the autonomic region of Navarra. The love affair started by Nordtank (before it merged into NEG Micon) with Taim-Tfg in Aragon, a company new to the wind power industry, has opened up a path to the still underdeveloped northeastern region of Aragon and provided a bridgehead into the centrally sited Castilla-Leon region, where only 15 MW of wind power are yet installed. And in Bonus, the Spanish shipbuilding enterprise of Bazan has found its ideal partner for diversification into the new business of wind turbine manufacture.

The ongoing wind power boom has also been stimulated by huge advances in the technology, most of which has come from abroad, although transfer agreements have turned several foreign brands into hybrids with a deal of Spanish blood. Gamesa Eolica turbines are built from original Vestas blueprints, but using parts made in Spain and incorporating adaptations suited to the country. Bazan is building turbines now going into the ground in new wind farms in Galicia as Bazan-Bonus 600 kW MK IV units. "We have seen companies introduce highly modern machines capable of generating electricity at relatively low wind speeds. The norm now is 500-600 kW machines. Anything under 300 kW belongs to the past," says Ladislao Mart’nez, an energy expert with Aedenat, one of Spain's biggest environmental federations.

Concha Canovas del Castillo, the Director General of Spain's main renewables institute, the Institute For the Diversification and Saving of Energy (IDAE), also points out that since Spain began showing an interest in wind power back in the late 1980s, the cost of developing wind stations has dropped considerably. "This will invariably lead to an increase in the use of renewables," she forecasts. Antoni Mart’nez of Ecotècnia, Spain's most active domestic wind turbine manufacturer and wind project developer, agrees with Canovas del Castillo. He also points out that interest rates are now just 6%-6.5%, which has brought the pay back period down to ten years for wind farms, depending on the specifications of the site. He also says banks are no longer wary of wind projects. "The government has finally indicated that prices for renewables are unlikely to drop once the new electricity law is finally approved and this has created confidence in wind power," he says.

The country's forthcoming deregulation of its electricity market -- a reality once the protocol is published in the government's official gazette -- has not only committed Spain to allowing consumers to choose their electricity supplier, but also to an environmental standard in electricity use, says Sergio Breto, an industrial engineer and wind expert who works for the Aragon autonomic government. Green minded consumers will be able to choose suppliers which derive power from wind and other renewable sources of power. At the same time the premium prices for renewable power will be retained in the new protocol. "Financial institutions no longer see us as a risk investment but as a sure-fire venture with guaranteed returns. There is a sense of security in investing in wind power which has been aided by the current economic situation in Spain," adds Mart’nez.

Map redrawn

These favourable conditions have certainly changed the wind power map of Spain as it was once contemplated by IDAE. The target in the 1980s was for under 200 MW by the year 2000, upped to 700 MW early this decade. But the current rate of installation set by Spain's different autonomous regions, however, Spain could easily top 2000 MW by the turn of the century.

In Galicia alone, 20 or so utilities and private companies have plans for a total of 2814 MW by 2005, 888 MW of which will be installed by the end of 2000, if everything goes to plan. In Navarra, in north central Spain, some 200 MW of wind power, mostly supplied by the Gamesa Eolica-Vestas alliance, will be added to the region's current 108 MW before the new century. Conservative estimates place the installed wind power capacity for the year 2010 in Navarra at 575 MW, without counting on a possible repowering scheme of the existing 500 kW and 600 kW turbines with 1 MW machines, adding another 100 MW.

Then there is Andalucia -- a region in southern Spain with 83.3 MW of wind turbines installed so far. It is likely to see its output increased by 20 MW within the next year once a new farm is completed in the Tarifa region -- and that is without counting plans for two more wind farms already approved in the same zone and another 57 wind power projects that have been put forward by developers for the area for building licences.

Promised land

The picture is the same in the Canary Islands, Catalunya, and in Castilla-Leon, but it is Aragon, situated in the northeast, bordering Catalunya, that has become the new promised land of wind power in Spain. The region already has 70 MW up and running at six wind farms, it had 40 MW more authorised by the regional Aragon government as recently as December, and it boasts massive plans for the future. The regional government is aiming to produce a large proportion of the population's electricity needs -- 20% -- from alternative energy systems, much in the same way neighbouring Navarra plans to derive 50% of its electrical requirements from its wind power production.

To do this the Aragon regional government, the Diputacion General de Aragon (DPA), has established what it calls a renewables action plan, a Plan de Accion de Renovables, which envisages putting 300 MW into the ground by 2000. But this is just the beginning, as Sergio Breto explains: "The fact that we have approved 300 MW does not mean to say that we are not going to grant more licenses to developers," he says. "It's up to developers to put forward what we call strategic wind plans. These strategic plans are all-encompassing development plans for the different regions, including the establishment in the area of wind turbine factories, or component manufacturing or assembly plants providing jobs," he continues. "In fact, we have already cobbled together a ten year 1700 MW strategic wind plan from several requests." Unlike the 300 MW action plan, however, such a regional plan is subject to licensing, environmental and viability studies before it becomes a reality.

Among the developers with a stake in Aragon is Taim-Tfg, together its Danish partner, NEG Micon. Taim-Tfg has plans to build 60 wind farms in the region with a total installed capacity of 1260 MW. Meantime Gamesa Eolica and Vestas have earmarked 350 MW for Aragon, while Ceasa, another Spanish company, is aiming to put 100 MW in the ground before the end of the millennium. Two others, Derasa and Molinos del Ebro are also hoping for a piece of the cake.

The sum of the projects forecast for 2000 is staggering compared to original forecasts for the Spanish sector a few years back. But if its current schedules are adhered to, Spain could easily outstrip most of its neighbours and, in the words of one expert, turn into Europe's wind power show case of the future.

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