Renewable Energy Doing Well In Spain, Portugal

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One industry in Spain and Portugal seems immune to the global recession: renewable energy. With hardly any fossil fuel resources, both countries have invested heavily in alternatives in the past decade. The Iberian peninsula is home to some of the world's biggest renewable energy companies — and some are conquering the U.S. market.


Renewable energy is big business in Spain and Portugal. That industry is holding up even in the midst of this global recession, which has slammed the economies of both countries. The Iberian Peninsula has little in the way of fossil fuel, but plenty of sun and wind. And both Spain and Portugal have invested heavily in alternative energy over the last few years. They are now home to some of the biggest renewable energy companies in the world. Jerome Socolovsky begins this report at a project that harnesses the power of waves in Portugal.

JEROME SOCOLOVSKY: On the beach in the northern Portuguese town of Agucadoura, there are a couple of fishermen sitting next to their rods and a surfer waiting for the perfect wave. Out to sea, there's a thin orange line just below the horizon. That's the Pelamis, an undulating steel snake that draws energy from the ocean.

Mr. MARTIN SHAW (Engineer, Pelamis Wave Power): You can see it flexing in the waves now, or you certainly see it, parts of it, disappearing as the waves go by.

SOCOLOVSKY: Martin Shaw is an engineer with Pelamis Wave Power, a Scottish firm that designed the 460-foot-long steel snake that generates electricity from wave motion. Pelamis is an ancient Greek word for water snake. Three of these modern metal snakes went online last September as the world's first commercial wave farm.

Mr. SHAW: So it's generating at the moment in these waves and sending the power back to the substation.

SOCOLOVSKY: Right now, the wave farm provides electricity to about 1,000 homes in Portugal. The plan is to enlarge it until it produces as much as a typical nuclear or coal-fired power plant. So why did a company from Scotland, one of the windiest places in Europe, set up its first commercial wave project in Portugal? The answer, says Shaw, is subsidies.

Mr. SHAW: The first farm has arrived here in Portugal because the feed-in tariff, at least a viable level was set here before anywhere else, and that really made it economically viable.

SOCOLOVSKY: The feed-in tariff is an artificially high price that the Portuguese government has set to encourage the generation of electricity by wave power. Public financing has fueled a boom in renewable energy in both Portugal and Spain. It's turned Iberian power companies like EDP, which operates the wave farm, into global giants of the renewable energy industry.

On a bluff above the town of Astudigio(ph) in northern Spain, 211 wind turbines turn slowly in the breeze. It's one of many wind farms in Spain operated by Iberdrola, the world's largest wind energy producer. Like EDP in Portugal, Spain's Iberdrola is making a big push in North America. Both companies have dozens of wind farms in the U.S., and they're spending billions of dollars to buy more. Here in Spain the government is also encouraging solar energy. Every new home must have solar panels installed on the roof. But Fernando Martinez Riaza of Iberdrola says wind power already supplies up to a third of the nation's electricity needs.

Mr. FERNANDO MARTINEZ RIAZA (Director of Renewable Energy, Iberdrola, Spain): (Spanish spoken)

SOCOLOVSKY: I think wind energy has a bright future, despite the economic difficulties we're having now, he says. In fact, the Spanish government sees renewable energy as part of the solution to the country's economic problems. Juan Carlos Martinez Lazaro is an economics professor at Madrid's IE Business School.

Professor JUAN CARLOS MARTINEZ LAZARO (Economics, IE Business School, Madrid, Spain): (Spanish spoken)

SOCOLOVSKY: Even in times of crisis, investment in renewable energy shouldn't be reduced, he says. On the contrary, it should be increased. He says the renewable energy industry brings jobs to rural areas and helps reduce the national trade deficit which is largely caused by oil imports. For NPR News, I'm Jerome Socolovsky in Astudigio, Spain.

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