POWER: Lower Prices Shift Spanish Developers to Reserve Markets

Spanish Renewable developers are bidding in the additional markets other than the day ahead to reduce profitability worries amid low power prices, with the development likely to continue, market participants said, cited by Montel.

• TSOs have seen a rise in participation in reserve and balancing markets – which are used to maintain the frequency of the grid and stop disturbances.
• Solar and wind plants have increased their activity in the secondary reserve market to around 25% over April-June this year from a minimal residual share in 2022, analyst at Optimize Energy Rodrigo Garcia said.
• And have also raised their share to 50% in the balancing service market.
• A solar plant may have earned an additional 5-7% on top of its spot market revenues through ancillary services in 2023, and “much more” this year, Garcia added.
• Spain has seen an increase in price cannibalisation recently, with this trend likely to continue amid the development of additional wind and solar plants.