20090831-IEA-Energy_Policies_of_IEA_Countries_Spain_2009_Review_162页_5mb

Summary of Energy Policies of IEA Countries: Spain 2009 Review

Core Content

The 2009 IEA review of Spain's energy policies highlights the country's progress since the 2005 review, emphasizing its leadership in energy diversification, renewable energy development, and market liberalization. The review also outlines key challenges and recommendations for Spain to achieve a more sustainable and efficient energy future.

Main Points

1. Energy Policy Progress

• Spain has made substantial progress in energy policy since 2005.
• It is fully compliant with IEA oil security requirements.
• Spain leads in gas diversification and LNG development in Europe.
• It has established the common Iberian electricity market, MIBEL, with Portugal.
• Spain has successfully integrated large amounts of intermittent renewable energy into its electricity grid.

2. Renewable Energy Development

• Spain is a global leader in wind power, with the third-highest generating capacity in the world.
• It has developed a well-integrated system to manage variations in wind power generation.
• The country has strong ambitions for solar and other renewable energy technologies.
• Spain has set a target of one million hybrid and electric cars by 2014 to support renewable integration.

3. Energy Efficiency

• Spain has increased its focus on energy efficiency to meet EU 2020 targets.
• Energy efficiency measures are seen as a cost-effective way to reduce peak demand and fossil fuel use.
• The government has implemented and enforced the 2004-2012 Energy Saving and Efficiency Strategy (E4).
• Subsidies for energy efficiency are encouraged as they provide environmental and security benefits at a lower cost.

4. Energy Market Reforms

• Spain has substantially de-regulated electricity and gas tariffs.
• The government has revised the tariff system to cover costs, reducing the deficit owed to utilities.
• However, some households still face frozen electricity prices, which may distort the market.

5. Climate and Energy Security Targets

• Spain must reduce emissions outside the EU Emissions Trading Scheme (EU-ETS) by 10% below 2005 levels by 2020.
• It needs to increase the share of renewable energy in gross final energy consumption from 8.7% in 2005 to 20% in 2020.
• It also aims to increase energy efficiency to help reduce EU energy demand by 20% by 2020.

6. Fossil Fuel Dependence

• Fossil fuels still supply over 50% of Spain's electricity, necessitating the exploration of all low-carbon options.
• The government is funding R&D on nuclear power and carbon capture and storage (CCS).
• Spain aims to progressively reduce the share of nuclear power in the energy mix while maintaining security of supply.

7. Institutional Framework

• The Ministry of Industry, Tourism and Trade leads energy policy formulation.
• The National Energy Commission (CNE) regulates electricity, natural gas, and oil markets.
• The Institute for Energy Diversification and Saving (IDAE) coordinates energy efficiency and renewable policies.
• The Strategic Reserves Corporation (CORES) manages energy security reserves.
• The Nuclear Safety Council (CSN) ensures nuclear safety and radiation protection.

Key Challenges

• Fossil Fuel Dependence: Over 50% of electricity still comes from fossil fuels.
• Tariff Distortions: Some households still face frozen electricity prices, which may hinder market efficiency.
• Subsidies for Coal: Domestic coal subsidies should be eliminated in favor of more targeted social policies.
• Peak Demand Management: Spain needs to reduce peak demand through energy efficiency and better infrastructure.
• Market Liberalization: While energy markets are being liberalized, some distortions remain due to price controls and subsidies.

Recommendations

• Continue to implement and enforce ambitious plans to save energy, reduce CO₂ emissions, and promote renewable energy.
• Keep open all options for low-carbon electricity supply, including nuclear, renewables, and CCS.
• Increase efforts to limit peak electricity demand through energy efficiency measures.
• Liberalize energy markets and develop social policies to minimize market distortions.
• Eliminate subsidies for domestic coal production and replace them with direct social measures.
• Ensure that energy efficiency and clean energy investments are central to economic stimulus packages.
• Implement revenue-neutral taxation on transport fuels to encourage low-emission vehicles and reduce CO₂ emissions.
• Support the development of electric vehicles and pumped storage to enhance renewable integration.
• Continue R&D investment in wind, solar, and CCS technologies.
• Strengthen the implementation of the Energy Saving and Efficiency Strategy (E4).
• Improve energy infrastructure, including interconnections and transmission networks, to enhance market efficiency and security.

Conclusion

Spain has made significant strides in energy policy, particularly in renewable energy and market reforms. However, it still faces challenges related to fossil fuel dependence, market distortions, and the need for further investment in low-carbon technologies and energy efficiency. The IEA encourages Spain to continue its efforts and align with international climate and energy goals.