The energy transition in Spain requires new business models and products better suited to market realities. This is the view of Gonzalo Barba, Managing Director of TotalEnergies, who participated in the panel “Boosting Demand and New Opportunities: PPAs, Datacenters, and Public Policy” during FES Iberia 2025, highlighting the need to sophisticate Power Purchase Agreements (PPAs).

“Traditional PPAs have provided value to consumers by decoupling energy prices from fuel costs, but now we must evolve towards more structured contracts tailored to each client,” Barba emphasizes.

According to the executive, conventional PPAs have ensured stable long-term prices, usually over 10 to 15 years, protecting consumers from geopolitical volatility. However, the context has shifted. “With falling prices during solar hours, we now see a move towards pay-as-produced contracts and solar-wind combinations that cover more hours of the day,” Barba notes.

Product diversification is essential. TotalEnergies already offers base load contracts, guaranteeing 24/7 energy supply, along with agreements offering discounts on market prices. “Some industrial consumers are very price-sensitive, while others value aspects like project proximity to their production site or building new renewable capacity,” Barba points out.

He insists that the renewable sector must self-reflect and continue this adaptation process. “Until now, the industry has assumed certain risks but not others, such as shorter-term contracts. We need to evolve and stop treating all customers the same, understanding how to deliver value to each,” he explains.

Increasing demand and electrification

A central theme of Barba’s intervention was the need to increase electricity demand through electrification. “We’re at a point where Spain’s electric system has been almost fully decarbonized. It’s difficult to continue progressing without higher demand and more electrification,” Barba warns.

In 2023, 57% of Spain’s electricity came from renewable sources, but the system shows signs of saturation. “Last year we had 800 hours with negative or zero prices. This indicates that the current decarbonization potential is exhausted without increasing demand,” he explains.

TotalEnergies estimates significant growth potential in sectors like light transport and building heating and cooling. “We can increase between 20 and 30 kilowatt-hours per user per year, representing a 10% rise in current demand,” Barba projects.

A predictable and agile regulatory framework

Regulatory stability is another priority for TotalEnergies. Barba clarifies that this does not mean regulatory stagnation but rather predictable and coordinated evolution. “Regulation must evolve alongside the involved stakeholders, but with clear and foreseeable timelines,” he affirms.

In this regard, he criticizes delays in implementing the capacity market, whose draft has remained stagnant since 2021, and the lack of development for demand aggregators.

Additionally, he stresses the need to streamline grid access permits and simplify procedures. According to Barba, consumers face the same bottlenecks as renewable producers. “Simplification and streamlining are crucial for the system to continue progressing,” he assures.

Along the same lines, Jordi Torres, Commercial Director of TotalEnergies Renewables, confirmed: “We expect the first capacity auction before the end of the year. This will allow us to remunerate firm capacity and provide long-term investment signals,” during the inaugural panel at FES Iberia 2025.

Attracting renewable industrial investment

Barba highlights the strategic opportunity for Spain to attract investment in industries related to the energy transition. “Spain has exceptional wind and solar resources and a pioneering renewable industry globally. We cannot waste this advantage,” he stresses.

The executive points to sectors like battery manufacturing, hydrogen production, data centers, and digitalization, which can create jobs and increase clean energy demand. “It’s a real opportunity to differentiate ourselves and offer cheap energy linked to renewable resources,” he emphasizes.

Finally, Barba calls on renewable producers and market agents to sophisticate their products and better meet demand needs. “We must be closer to the client, understand how we bring them value, and keep reducing costs for consumers,” concludes the Managing Director of TotalEnergies.