In 2023, Alantra established a highly specialized Energy Transition business, providing advice to corporates, energy companies, and investors aiming to lead the energy transition. The team is working with over 20 clients on market and strategic advisory projects, as well as M&A and debt advisory mandates, facilitating the development of solar, hybrid, battery, and renewable gas plants, among others. In addition, Alantra has created a set of services to help companies invest in their decarbonization processes.
Challenges and Opportunities for Industrial Decarbonization: Future Energy Market Dynamics
• Spain’s growing renewable energy sector is driving down electricity costs below the EU average and promises even lower prices ahead.
• Natural gas prices are expected to stay volatile and higher than historical levels due to global demand, supply issues, geopolitical tensions, and weather events amid the shift to cleaner energy.
• CO2 prices will thrive in decarbonizing the EU economy, stabilizing at 70 €/tCO2eq by 2030 and rising to 130 €/tCO2eq by 2040 due to policy overlaps and a tightening emissions cap.
• Electrification is reducing energy demand by leveraging efficient electric technologies, particularly in low-temperature industrial processes like food drying and beverage production.
• Grid reinforcement is vital for the energy transition, with the EU seeking to boost investments, which Ember Climate claims are underestimated by at least €5bn annually under REPowerEU.
• Active energy management is a core strategy for transforming energy from a pure cost into a source of income.
The Future of the Spanish Electricity Sector: Market Dynamics and Implications for Financing
• Supply and demand flexibility, driven by the integration of renewables and changes in consumption, shape the European energy market.
• Alantra’s price projections incorporate geopolitical instability scenarios from 2024 to 2026. Expectations for market stabilization from 2027 to 2035 align with a fundamental equilibrium price derived from real production costs, alongside a shift towards LNG supply in Europe over Russian pipeline imports.
• Alantra’s CO2 price projections hinge on three scenarios: a baseline where prices hit 105 EUR/tonne by 2030 aligning with EC targets, a high scenario driven by the futures market, and a low scenario reflecting plummeting prices due to EU emission target reductions, all shaping decarbonization strategies.
• Rapid renewable capacity growth may lower solar energy prices, slowing market development projects beyond 2027.
• The development of batteries will be at the cornerstone of the accomplishment of decarbonization targets. These assets comprise complex operating behaviour in the market as they can access multiple revenue streams.
• Using modeling tools and price projections, Alantra Energy Transition can help optimize planning and decision-making in the energy sector, optimize investment while improving efficiency and mitigating financial risks.
Data Centers: Benefitting from Enabling the Energy Transition
The booming data center industry faces a critical challenge: decarbonization. Alantra Energy Transition can help address this by:
• Supporting the implementation of decarbonization strategies to improve ESG ratings, create revenue streams, and achieve cost savings.
• Facilitating active energy management with hybrid BESS systems for market participation and reliable power supply.
• Identifying and mitigating environmental risks, reducing operational costs, and attracting eco-conscious clients.
• Opening new investment opportunities in clean energy solutions designed for data centers.