The savings generated by renewable energy in 2023 maintained the strong pace set in the previous year, which marked a historical record. In the electricity sector, the net savings reached 9.575 billion euros.

On a global energy level, the savings were even higher than in 2022, although the reduction in energy prices led to a decrease in economic savings from fossil fuel imports, which amounted to 15.622 billion euros, and CO2 emissions savings, with a total of 5.586 billion euros.

The pace of new capacity installation remained steady, with photovoltaic power for market sales as the main contributor, although there were setbacks in self-consumption and wind energy. This slowdown in certain technologies resulted in a slight decrease in employment in the sector, with a 2.5% drop, bringing the total to 127,576 jobs.

Among the key milestones of 2023 were the record-breaking renewable generation, which surpassed 50% of total electricity, the slight contraction of sectoral GDP, and the savings of 25 million tons of oil equivalent, compared to 21.4 million in 2022.

All these figures were presented in the “Study on the Macroeconomic Impact of Renewable Energy in Spain,” prepared by Deloitte, at an event chaired by Santiago Gómez Ramos, President of APPA Renovables, and José María González Moya, General Director of the Association, alongside Arcadio Gutiérrez, General Director of Enerclub.

This year’s edition reflects the strong performance of the sector following the historical highs of 2022 but also anticipates a slight slowdown. To achieve the ambitious objectives of the PNIEC, concrete measures will be needed to revitalize the sector and consolidate its growth.

Santiago Gómez Ramos, President of APPA Renovables, and José María González Moya, General Director of the Association, presented the main macroeconomic figures of the national renewable sector.

After the record contributions to GDP and job creation in 2022, both figures have experienced a slight decline, although savings have remained strong, especially in the electricity sector, highlighting the benefits that renewable energy brings to our economy.

Slight Contraction of Indicators Following 2022 Record

In 2023, two factors influenced the national renewable sector. On one hand, energy costs decreased, with the electricity market being a good example, where prices moderated after the record levels of 2022, dropping from €167.52/MWh to €87.10/MWh.

On the other hand, the installation rate experienced a slight slowdown. While photovoltaic for grid sale installed 1 GW more than the previous year, self-consumption decreased its annual installed capacity by 27%, and wind energy installations were reduced by half compared to the previous year.

The reduction in electricity market prices, as well as the cost of fossil fuel equivalents in non-electric renewable sectors, led to a decrease in GDP contribution, which stood at €16.495 billion, the third-highest figure in the historical series after 2022 and 2021, years heavily impacted by inflation and high energy prices. Overall, the renewable sector represented 1.13% of national GDP.

Regarding employment, a slight decrease in construction activity, particularly related to self-consumption and wind energy, affected the job market, which decreased slightly (-2.5%) to 127,576 jobs.

Record Net Savings in the Electricity Market

The 50.4% renewable electricity milestone marked 2023, where the relationship between renewable generation and market prices was very clear. Renewables, due to their depressing effect on the wholesale market, saved €12.745 billion for the electricity system.

This, coupled with a reduction in regulated remuneration (€3.170 billion), due to the exit of wind and hydro from the incentive system, led to the highest net savings in history: €9.575 billion.

Viewed globally, also accounting for biofuels and thermal renewables, renewable energies avoided the importation of 25 million tons of oil equivalent (compared to 21.4 million in 2022), resulting in a savings of 15.622 billion euros in fossil fuel imports.

The reduction in fossil fuel prices during 2023 created the paradox that, while the substituted energy increased by 15.1%, the economic savings decreased by 13.4%. The use of renewables in our energy mix prevented the emission of 66.9 million tons of CO2, which led to savings of 5.586 billion euros in emission allowances.

The need to incentivize demand

“The PNIEC sets clear and ambitious goals, among which the electrification of demand stands out as an important objective, one that we fully share and value very positively,” said the President of APPA Renewables, Santiago Gómez Ramos, during the presentation of the Study.

However, he also highlighted the significant challenges that the PNIEC faces: the imbalance between supply and demand and the imbalance between technologies.

“If we don’t advance in the development of energy storage, demand flexibility, and the search for a balanced renewable mix, what we experienced in April (the lowest monthly electricity price in history) could become a trend,” reflected Gómez Ramos.

In his speech, the president of the Association referred to the goal of increasing electricity demand by 34% by 2030 as a “goal as ambitious as it is necessary” and reminded that it will have to coexist with the development of self-consumption and the promotion of energy efficiency, both of which effectively reduce electricity demand.

“We must promote renewables in all areas, especially in thermal uses and transportation; and to balance supply and demand in the electricity sector, it is necessary to put effective measures on the table to incentivize the electrification of fossil fuel uses and attract new electro-intensive industries that allow us to harness all our potential,” concluded the president of APPA Renewables.