Spain’s Energy Sector and Industrial Landscape: Challenges and Opportunities
Current Importance of the Energy Sector
Energy consumption is directly related to the economic development of countries. Spain faces a strong imbalance between production and consumption, being dependent on imports. Some forms of energy production generate significant environmental impacts and risks. Therefore, a shift towards renewable energies is becoming increasingly necessary.
Rapid Growth of Energy Production and Consumption
Energy consumption in Spain has grown at the same rate as economic activity and living standards, currently doubling the oil level of two decades ago and nearly tripling that of 1973. Until recently, the major energy source was coal, but now it is oil (48%), followed by natural gas (22%), coal (13%), and nuclear energy (11%). Energy production has remained stagnant for the past two decades, only reaching 28 million tonnes of petroleum. Its sources are:
- Coal, accounting for 22% of production and used as fuel in thermoelectric power plants.
- Nuclear energy, generating more than half of the obtained energy.
- Renewable energies, corresponding to the fastest-growing sector.
The Need for Energy Policy
Energy needs proper planning and management. This has led to several national energy plans and the approval of a Renewable Energy Development Plan. The main objectives of these plans are:
- Establish cooperation agreements with major oil and natural gas producing countries to ensure constant supplies.
- Reduce external energy dependence.
- Maintain national coal consumption in thermoelectric power plants.
- Liberalize the sector and eliminate state monopolies, increasing competition among companies.
- Promote savings and greater efficiency in energy use.
- Reduce pollution impacts associated with certain energy production methods.
- Promote the growth of renewable energies.
Business Innovation
Business innovation refers to improvements introduced in manufacturing processes, products, or the organization of firms to increase their competitiveness and maintain employment.
Industrial Districts
Industrial districts are cities or regions with a concentration of industrial SMEs specializing in one type of product (e.g., footwear, furniture). Firms compete in the same markets but also collaborate on joint projects that benefit them.
Major Weaknesses of the Spanish Industry
The Spanish industry faces various threats due to its weaknesses and the effects of globalization and the technological revolution:
- A large presence of traditional sectors that use a lot of unskilled labor.
- Many large industrial enterprises are foreign-owned multinationals with little rooting in the territory. This delocalization affects industries such as automobile manufacturing or electrical equipment.
- A predominance of small businesses, with over 80% of companies operating with fewer than 20 employees and having limited economic resources.
- Part of the traditional industry remains in inner cities, generating negative environmental effects.
Industrial Policies and Their Types
Industrial intervention policies are divided into two types:
- Promotion policies: Aimed at fostering the development of industrial activities of particular importance.
- Urban and spatial planning policies: Aimed at building quality spaces for the smooth operation of businesses, such as industrial estates and parks.
Types of Industries
Basic or Header Industries
These industries directly transform natural resources in large quantities.
Equipment Industries
These industries use the products of header industries as feedstock for downstream products.
Final Goods Industries
These are the most numerous and diverse, manufacturing products for direct consumption by the population.
Key Industrial Concepts
- Iron and steel: Technique for treating iron ore to produce steel and derivative products, used as feedstock for other industries.
- Agribusiness: Industry using agricultural or livestock products as the basis for manufacturing consumer goods.
- Series production: Manufacturing system of standardized products in large volumes, allowing lower costs.
- Multiplant company: A company that has more than one work center and divides its activities among different premises, based on the advantages each territory can offer.
- Industrial diffusion: Shift of industrial activity from major cities and regions to peripheral areas.
- Industrial park: Urban space for the installation of industrial companies with warehouses and complementary services, usually located on the outskirts of cities and along main roads.