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Negative prices and hybridisation: the new playing field for renewable developers

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  • Negative prices and hybridisation: the new playing field for renewable developers
  • 26 May 2026 by
    Negative prices and hybridisation: the new playing field for renewable developers
    Marc Oliva Carbonell

    The Spanish electricity market entered 2026 in a qualitatively new stage. The data for the first four months confirm it: renewables reached 61.8% of the national generation mix, with four consecutive months above 60%, according to the electricity system reports published by Red Eléctrica. Informe del sistema eléctrico | Red Eléctrica.

    But behind this historic figure there is a second data point that completely reshapes the economics of renewable projects: Spain recorded 397 hours of negative prices in the first quarter alone, a figure dangerously close to the 555 hours accumulated over the whole of 2025. If we add the zero-price hours, we are already talking about 16% of all the hours in the period, according to the day-ahead market results from OMIE. Precio del mercado diario | OMIE

    For a developer who sized their project three or four years ago, this reality breaks fundamental assumptions of the financial model. The classic hypothesis —produce as much as possible and sell everything you generate into the pool— no longer guarantees the expected return. The paradox is clear: the more successful the energy transition is in terms of installed capacity, the more downward pressure solar surpluses exert on the price during the middle hours of the day, precisely those when the plant produces most.

    From a generation model to a value-capture model

    The paradigm shift has a clear name: moving from optimising generation to optimising price capture. And that means rethinking both new projects and assets already in operation. The question developers are asking themselves today is not how many MWh the plant will produce, but at what weighted average price each MWh will be sold over its useful life. The difference between these two metrics —the capture factor— is what today separates a profitable project from a project with cash flow problems.

    In this context, battery storage (BESS) has stopped being a strategic option and become a structural element of the design. Hybridising solar and wind plants with BESS systems provides three simultaneous value levers: mitigating curtailment during negative-price hours, arbitraging between hours of oversupply and demand peaks, and providing ancillary services to the grid that generate additional revenue outside the day-ahead market. The first quarter of 2026 clearly showed that this combination substantially widens the arbitrage windows between the daytime solar surplus and price peaks at times of low wind output.

    What to review in new projects and in operating plants

    For a greenfield project, design can no longer start from the solar capacity and add batteries as a complement. The correct approach is the opposite: size the plant from a target price-capture curve, define the PV/BESS ratio that maximises it according to 15-20 year market forecasts, and validate the result against the technical requirements of the connection point. This process requires integrating market modelling, electrical engineering and environmental design from day one, avoiding the late iterations that erode margins.

    For plants already in operation, the analysis is different but equally urgent. Three alternatives must be assessed technically and economically: adding BESS at the same connection point, taking advantage of the existing access permit; hybridisation with a second technology (for example, adding wind to a solar plant with a complementary profile); and, for wind assets approaching the end of their useful life, repowering with high-efficiency technology that can multiply generation at the same site without needing new land permits.

    This last route is gaining ground at European level according to SolarPower Europe, which points to hybrid solar plants and hybrid PPAs as the sector response to the new price patterns.

    The role of consulting engineering

    This new landscape calls for consultancy that speaks three languages at once: that of electrical engineering and technical design, that of environmental and administrative permitting, and that of economic and market modelling. The three fields are now more intertwined than ever: a technical decision on battery size has immediate implications for the revenue curve, and an environmental constraint on land take can tip viability towards a more intensive hybrid configuration.

    At auma auma we support developers, industry and administrations in this transition towards an electricity system where clean energy is no longer the challenge —producing it has been solved— but where the challenge is managing it, storing it and monetising it intelligently. The next two years will be decisive: the projects that manage to integrate generation, storage and market strategy from the design stage will be the ones that capture real value in a system that is ever more abundant in energy but ever more demanding in terms of its flexibility.

    in News
    # Developers Energy transition Renewable energy
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