Biomass power: Exploring the diffusion challenges in Spain

The use of biomass resources for power generation offers numerous benefits of interest for political decision-makers: fuel security, rural and industrial development, ecological benefits. In Spain, policy instruments have been used since 1980 to stimulate biomass power generation. However, the diffusion outcome by 2007 was very disappointing: only 525 MW. This paper argues that two factors lie at the core of this: the conceptualization of biomass resources by political decision-makers in the instruments used, and the desire that policy instruments be in line with market liberalization principles. These generated a persistent economic obstacle for biomass power generation, and impeded the development of markets for the supply of biomass resources. The policy learning regarding the heterogeneity of biomass resources, and the investors’ expectations on risks, profitability and resource markets was very slow among political decision-makers. The paper contributes to the understanding of diffusion outcomes by proposing to analyse diffusion by means of five indicators: types of resources, technologies, developers, motivations to invest and project sizes. Besides, the paper shows the usefulness of investigating policy instruments in terms of their risk and profitability characteristics. This enables a better understanding of the diffusion patterns and outcomes.