Spain’s Rural Areas Are Backing Wine Over Wind Farms

(Bloomberg) -- For over four decades, Maria Jose Nestares’ family has quietly run a vineyard in the Spanish northern region of La Rioja, one of Europe’s largest wine-producing areas.

But about four years ago, when a major turbine maker started building a wind farm next to her winery, she decided to pick a fight with what she sees as a nasty infringement on the otherwise pristine, bucolic community.

“Building plants massively here means we’re taking the brunt of the production of energy that will actually supply Madrid and Barcelona,” said Nestares, a lawyer who owns the namesake winery alongside her sister. “That’s unfair.”

The regional government of La Rioja agreed and last year approved a moratorium for all new energy projects until a landscape law is passed. 

Nestares’ argument embodies a tension between Spain’s rural and urban communities that’s been growing over the years. The vast majority of Spain’s landmass — around 70% — is sparsely populated and residents of those regions have felt for decades they have been overlooked by the national government. 

The areas, known in many parts as , or “empty Spain,” have craved more locally beneficial investments, and they’re eager to have their concerns heard. Blocking renewable installations that boost the economies of faraway cities more than their rural source is just one way to do it. Even if it means putting the country’s climate ambitions at risk. 

Last year Spanish Prime Minister Pedro Sanchez’s government announced a national target to generate 81% of all energy from clean sources by 2030. This requires nearly doubling current wind capacity to 62 gigawatts by the end of the decade — something that analysts have said would be difficult to achieve no matter what.  

“[The goals are] so ambitious that they represent their own main hurdle,” said Javier Pamos, an analyst at Aurora Energy Research Ltd. 

Opposition to turbines in the countryside isn’t helping and new regulations are a constant threat. The region of Galicia, which is about 98% rural, passed a proposal late last year to force new and repowered wind power generators in the northwest territory to sell at least half of the electricity they produce to local companies through power purchase agreements.

The proposal was strongly criticized by Spain’s wind lobby AEE and other industry groups for creating possible market distortions and an unfavorable investment climate in the region.

In the northeast, the government of the underpopulated region of Aragon introduced a new tax on both wind and solar projects deemed to have an adverse impact on landscape last year. Controversially the levy applies to not just new projects, but ones that were already under construction, according to Heikki Willstedt, director of energy policy at AEE. 

“You cannot give permits, facilitate the construction of wind farms and then, once they're built, when it’s too late to go somewhere else, impose a levy,” he said. That adds up to “the bad regulatory practices toward investors.”

Traditionally, Spain has been seen as a relatively friendly environment for wind development. According to grid operator Red Electrica, Spain currently boasts a capacity of 32 gigawatts of wind power, which makes it second only to Germany in the European Union. 

Wind, however, has been under pressure everywhere. Developers are facing significant bottlenecks worldwide, ranging from insufficient supplies of equipment to permitting issues and grid access delays. Local opposition to renewable farms is also a common problem.

In Spain, getting rural communities to accept visual burdens in their backyard for the sake of national climate goals is proving to be a hard sell.

There’s a “growing negative feeling stemming from the lack of clarity about how renewable plants are actually beneficial for the area where they’re built,” said Oscar Barrero, head of energy at PricewaterhouseCoopers LLP Spanish unit. “The environmental transition ministry and the involved companies are actively trying to revert such feeling through local social impact policies.”

In a government energy hearing on Thursday, Spain’s Minister for Ecological Transition Sara Aagesen said, for future tenders to access power network nodes, developers will have to show the local benefits of their renewable projects. The projects must be the best from the standpoint of “solvency,” as well as “territorial benefit” and “job creation,” she said.

For rural residents like Nestares, there are better solutions out there than large-scale wind. “We champion renewable energy, but the power model should foster nearby solar, with regions generating locally according to their needs,” she said.

In Nestares’ view, there’s an intangible ingredient at risk in the Rioja she sells. “The environment where wine is produced is somehow part of the final product,” she said, “and the presence of a huge turbine next to a vineyard is simply unacceptable.”

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