The industry is now demanding that the Government pay for the electricity it generates with gas to prevent up to 111 factories from leaving for other countries.

The Spanish industry lives in uncertain times, with the need to decarbonize its production techniques but for which it still does not have sufficiently developed and cheap technologies and the natural gas remains the raw material with which sectors such as petrochemical, food, agricultural, paper or textile generate heat necessary for their transformation processes, through technology of cogeneration. In the same process, it is also generated electricityfrom which These industries only consume around half. of the payment, the remuneration, by the Government Their survival depends on the part of the electricity they do not consume, especially on the more than a hundred factories -40% of them in Catalonia- who have already been excluded or are about to do so from this regulated remuneration and who They could choose to relocate, establish themselves in other countries, where they are guaranteed a payment for that energy that is vital to continue functioning and attract investments to transform towards a ‘cleaner’ sector.

The association that brings together the cogeneration industry, WELCOMEwarned this Thursday that this sector – which represents 20% of the GDP and brings together some 200,000 industrial jobs – “faces the most difficult stage in its history“given the effects that the delay for years by the Government of a new remuneration regime for the production of electricity from natural gas for 15% of national demand. It is one of the fossil fuels that the Government is committed to banishing as soon as possible. Although this process is in the hands of the Ministry of Industrysources in the sector indicate that everything ultimately depends on the Ecological Transitionwhich designs energy and climate policy.

As promised two years ago, the sector hopes that next week or, at most, the Government will make the “political decision” to approve a new remuneration regimethat is, to specify How much will each megawatt pay? (MW) of electricity that, together with heat, is generated from gas in cogeneration plants. Depending on the case, these facilities are another part of sugar or ceramic factories, or the activity of energy companies that later sell them to them, but equally critical for their competitiveness.

The sector hopes that this price will be set “before June”, as a preliminary step to the real milestone, the call that they hope will be as soon as possible for a regulated auction in which the Government commits to remunerating the production of 1,200 MW of electricity by cogeneration, to allow the industry to continue functioning. Specifically, they hope that in a month the auction will be announced, which would be the next since the last one, in 2012.

If this does not happen, ACOGEN warns of “imminent risk of relocation” of up to 111 factories, which represent 25% of the cogeneration sector, which has been in decline for years – between 2019 and 2023 it is claimed that it has fallen by 45% – and with it, Spanish industrial production has gone from producing 11% of national electricity at 6.5%. Between 2021 and 2024 will have reached the end of their useful life and that they will no longer receive any remuneration in Spain for their electricity production and that they could go to other countries in search of this income. This risk of relocation can especially affect communities such as Cataloniawhere the effects of continuing without a remuneration framework can affect 40% of its cogeneration industries, but the problem is on a national scale.

“Cogeneration is all over the country. When you go to a supermarket, chocolate, cheese, oil, preserves, everything is produced in the chemical sector, in the food sector. Plans have been delayed and this industry has lost his compensation, “they cannot invest, there are companies with 30% of their plants stopped waiting to invest”, the president of ACOGEN has warned, Ruben Hernando, regarding the situation of the industry, it is difficult to electrify its production processes and at the moment it only has natural gas as a source of energy.

This Thursday, the association presented a survey in which, among other things, industries in the cogeneration sector responded that the 35% of them sell part of their electricityd to the market operator (OMIE), and only a 11% supply it to “neighboring consumers” through local self-consumption due to regulatory barriers.

“We are the country of renewables. If we want to continue being the country of industry, cogeneration makes perfect sense“, Hernando highlighted about a sector that in Spain brings together 33 facilities in the chemical industry; 13 in refining; 25 in pulp and paper, 36 in food and beverages; 19 in waste, including slurry and olive groves, or 18 tile factories, in addition to , to a lesser extent, other areas of metal, automobiles, bricks, agriculture and textiles.

According to ACOGEN data, the 63% of industrial companies that operate through cogeneration are SMEs and the remaining 37%, large companies, which generate most of the electricity for which they now expect compensation, 3,124 MW. In the auction that the sector expects like May water, they will be auctioned 1,200 MW, although sector sources double real needs in double, 2,400MW. But at least they consider that it will serveto ‘save’ the companies and factories that are in the worst situation25% of the cogeneration industry to which the Government no longer compensates the electricity they generate and do not consume and who They no longer have this source of income to continue functioning.oo to face new investmentsmainly to follow the path towards decarbonization, which in this sector is more complicated because they still do not have efficient or profitable alternatives to abandon fossil fuels.

The third element that “urges” this industrial sector is extend the life of companies that meet the end of their useful life by two years -another 37 in 2024 that will add to 26 last year or 18 in 2022- so that they can invest without forced stops. “The end-of-life calendar for cogeneration is leading Spain to a severe industrial setback,” says ACOGEN, which in addition to an auction as soon as possible “to reverse the progressive disappearance of cogeneration” and, with it, “the loss of the multiple benefits it brings to the industry, to the energy systems and to the country.

Clean energies

Sector sources do not hide their conviction that if there already existed a raw material capable of replacing gas natural as a source of energy in the cogeneration industry, the auction that they have been waiting for for years would have already been held. However, the reality reflected by the responses of these companies in the survey prepared by ACOGEN shows a reality in which the majority of companies that already use also photovoltaic panels to generate electricity and much less other alternative energy sources such as hydrogen, still considered a “developing technology”.

With regard to “mature technologies”, 76% of companies in the sector already have photovoltaic panels installed, while around 46%-47% of companies are studying and developing photovoltaic projects. biogas, biomethane, electric boilers or heat pumps. There are fewer prospects regarding “developing technologies” such as hydrogen (only 43% say they are taking it into account), thermal storage (29%) or CO2 capture and storage (23%).

ACOGEN defends that in order to make this ecological transition, these industries need, firstly, to continue existing through cogeneration with natural gas and, secondly, with a remuneration regime that allows them to face the investments necessary to make this change.