The upcoming solar auction in Spain is emerging as a key opportunity for investors with shovel-ready projects. José Donoso, Director General of UNEF, asserts that the current situation is very different from the failed calls of 2022, when only 5.8% of the offered capacity was awarded.

“Right now there is less uncertainty, but we need certainty,” he tells Strategic Energy Europe, explaining that the combination of less attractive spot prices and PPAs that fail to reach reasonable levels is pushing developers to seek mechanisms that guarantee stable long-term revenues.

In recent months, the electricity market has moved away from the exceptional scenario of very high wholesale prices, standing in 2025 at an average price close to €50/MWh (based on the OMIE wholesale market average from January to July 2025).

Meanwhile, the few private contracts being closed are doing so at prices around €35/MWh, according to specialist consultancies, although most buyers are demanding figures increasingly close to €30/MWh.

In 2022, the third and fourth auctions —held in October and November— offered 1,940 MW of solar-specific capacity. However, the lack of administrative extensions, unattractive price caps and the preference for more profitable PPAs meant that the latter awarded only 31 MW of solar.

At that time, for the fourth quarter of 2022, LevelTen estimated that the price of PPAs had reached approximately €76.84/MWh.

The change in circumstances is clear. In addition to the drop in interest in private contracts, spot price volatility has increased, with more than 600 hours at or below €0 in the first half of 2025, reducing the profitability of plants without guaranteed contracts.

In this regard, Donoso stresses: “We need auctions soon to give investors that security, ensuring that if they feed their energy into the system, they get paid for it.”

Moreover, UNEF argues that these tenders should include storage requirements to optimise grid use and stabilise final prices, defending the idea that this solution would make it possible to shift energy from off-peak to peak hours, capturing greater value and reducing curtailment.

The market potential remains vast: there are 910 GW in grid-connection requests, with around 30-40% linked to industrial projects. Donoso insists that channelling this demand through a competitive and stable framework is vital for the country’s reindustrialisation, and generation will be needed to supply this demand.

What signals is the Spanish Government sending on the next auction? Despite official and unofficial statements of intent to launch a call soon, the silence persists.

Donoso says the Government has on several occasions expressed its willingness to move forward with this mechanism, adding: “They have told us repeatedly ‘yes’,” but he criticises the lack of action.

“What we want now is for it to be finalised sooner. A renewable auction in 2025 is still entirely possible,” concludes the UNEF Director.