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Iberdrola launches huge renewables plan for coal wind-down in Spain

As COP25 opens, Spanish group eyes 550MW of wind and PV to replace last coal-fired plants

Utility Iberdrola is submitting a plan to build 550MW of subsidy-free wind and solar to replace the group’s last Spanish coal-fired power plants.

Speaking at the opening of the COP25 UN climate summit in Madrid, Iberdrola group chairman Ignacio Galan said the renewables projects would replace two coal generators that are scheduled to be decommissioned next year.

The proposal, to be presented on Monday to Spain’s Ministry for the Ecological Transition, would see 420MW of new wind and PV deployed in Velilla in the province of Palencia, and four wind farms with a joint capacity of 130MW in Lada, in Asturias, both in the country's north.

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The new renewables capacity – due online in 2022 – will be underpinned by power purchase agreements (PPAs), reflecting the strong appetite for such deals in the Spanish renewables market and the competitiveness of wind and solar, Iberdrola told Recharge.

Iberdrola didn’t give a detailed breakdown of the renewable projects at either location, but said both sites have good wind and solar resources, plus strong grid connections.

With a combined capacity of 874MW, Velilla and Lada are Iberdrola’s last remaining coal-fired power plants. An application for their phase-out was filed in 2017 and the Spanish government is expected to give a final ruling on the matter next year.

The Spanish utility giant said it will implement an “ambitious socio-economic development programme” in the areas affected by the closure of coal, which it will discuss with the ministry.

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“Over the course of 15 years, Iberdrola will have completed the process of phasing out a total of over 8.5GW of coal-fired and fuel oil power generation capacity in several countries,” said Galan.

Spain’s delayed Climate Change & Energy Transition law, now expected to be enacted early next year, includes a 74% renewable power target for 2030 and phase-outs of coal and nuclear generation on the road to carbon-neutrality by mid-century.

The country’s acting socialist prime minister Pedro Sanchez, who last month struck a deal with the far-left Podemos party in a bid to form a coalition government, has promised to put an end to all fossil-fuel subsidies, to ban all new oil & gas exploration in the country, including fracking, and to switch to a 100% zero-emissions vehicle fleet by 2050.

Through “just transition” contracts, Spain will shut down most of its coal mines in return for early retirement schemes, re-skilling with clean energy jobs, and environmental restoration.

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“Replacing CO2 emitting generation facilities with clean, renewable power capacity is an important milestone for Europe and showcases Iberdrola’s leadership in the energy transition,” said Galan.

Madrid is hosting the COP25 summit from 2 to 13 December after the massive anti-government protests and social unrest in Chile led president Sebastian Pinera to pull out of hosting the event. Some 25,000 delegates from 200 countries are expected to attend.

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