Photovoltaic energy leads electricity generation in Spain with 27.6% of consumption

Photovoltaic solar energy has consolidated itself as the main source of electricity generation in May, according to data from Red Eléctrica de España (REE). This advance represents almost 24% of total electricity production and 27.6% of national consumption, excluding exports. This achievement stands out even more when one considers that just five years ago, photovoltaics was the seventh largest energy source, surpassed even by coal.

The growth of photovoltaic solar energy is not limited to large ground-based photovoltaic plants, but also includes an increase in self-consumption, that is, solar panels installed on the roofs of homes and businesses. Although this data is not yet fully integrated into REE statistics, it is estimated that, adding this domestic generation, solar panels already contribute more than a quarter of the electricity

generated in Spain in May.

Photovoltaics could close 2024 as the third largest source of generation, surpassing combined cycles, and probably, in 2025, it will surpass nuclear, positioning itself as the second largest source of electricity generation.

The rise of photovoltaics has raised concerns about possible price cannibalization, where the oversupply of solar energy during peak production hours could sink prices and discourage investment in new panels. To mitigate this risk, it is crucial to increase electricity demand, driven by electric cars and aerothermal systems, as well as the incorporation of batteries and pumping systems to store surplus renewable energy.

After the rise of photovoltaics comes that of batteries, to manage the generation and consumption of energy.

Increasing demand will also be essential to make the most of solar generation. Despite the challenges, electricity consumption in Spain has begun to recover, growing 1.5% so far this year, according to REE. The combination of an increase in renewable energy generation and increased demand has led to a historic reduction in electricity market prices. In April, the cost of a megawatt hour (MWh) fell below 13.7 euros, the lowest level on record, and in May it stood at 30 euros per MWh.

However, an increase in prices is expected in the coming months due to the lower production of wind and hydraulic energy during the summer and the increase in demand for air conditioning systems. Despite this rebound, the prices projected for June (44 euros per MWh), July (68 euros) and August (76 euros) remain manageable from the point of view of the electricity bill.