Spanish power utilities warn electricity grid is saturated

MADRID (Reuters) -Spanish power utilities lobby Aelec warned on Tuesday most of the country's electricity grid is saturated and requires massive investment to allow new connections.

Aelec has analysed a global map published by Spanish grid operators and concluded that more than 80% of the Spanish grid's nodes cannot handle any increase in the volume of generated electricity, which would lead to instability and reduced efficiency. The country's grid is mainly operated and coordinated by Redeia.

More investments, higher returns on these investments and strict planning are needed to prevent bottlenecks, Aelec said.

"Without these conditions, it will not be possible to connect industry, housing, storage, or electric mobility, wasting the potential of renewable energy and limiting the economic growth and competitiveness that electrification can bring to Spain," Aelec said in a statement.

A massive blackout that hit Spain and Portugal on April 28 reignited a debate about investment needs in the country's power networks and the return on such investments.

Spanish authorities regulate investments on grids and set a limit on the returns on these investments, which are paid for ultimately by consumers.

The anti-trust watchdog CNMC has raised the return on investments to 6.46% from the current 5.58%, but utilities demand a return of 7.5%.

(Reporting by Inti Landauro, Editing by Louise Heavens)