Repsol Expands Aguayo II: 1,014 MW of Hydroelectric Storage in Cantabria

Key data

Repsol Generación Eléctrica, SAU, obtains final approval to execute the largest expansion of pumped-storage hydroelectricity in Spain in recent years. The Resolution of June 11, 2026 from the General Directorate of Energy Policy and Mines grants the company both prior administrative authorization for modifications and administrative authorization for construction of the Aguayo II plant expansion in Cantabria.

The resolution, published in the Official State Gazette on June 26, 2026, also includes a declaration of public utility for the project, a key legal instrument that facilitates the occupation of land necessary to build the evacuation infrastructure.

What does this regulation establish?

The resolution grants Repsol Generación Eléctrica, SAU, two simultaneous authorizations that unlock project execution:

• Prior administrative authorization for modifications: validates the technical changes introduced with respect to the original Aguayo plant project.
• Administrative authorization for construction: enables the effective start of expansion works.

Additionally, the resolution includes two additional elements of great operational relevance:

The project affects the municipalities of San Miguel de Aguayo, Bárcena de Pie de Concha and Molledo, all in Cantabria. The reversible hydroelectric plant functions as a large energy storage "battery": it pumps water to an upper reservoir when there is excess electricity on the grid and generates electricity through turbines when demand is high.

Economic and operational impact

The expansion of Aguayo II represents one of the largest investments in pumped-storage hydroelectricity in Spain. The economic and operational implications are relevant in several areas:

• For Repsol Generación Eléctrica: the authorization unlocks the execution of a large-scale project that strengthens its position in the Spanish electricity market, especially in flexibility and grid balancing services.
• For the national electricity system: adding 1,014 MW of generation and 1,181 MW of pumping significantly increases manageable storage capacity in Spain, key for integrating intermittent renewables.
• For Red Eléctrica: the removal of the 220 kV line represents a change in the ownership of evacuation infrastructure, with implications for transport network management.
• For affected municipalities: the declaration of public utility means that Repsol can initiate land occupation procedures, with corresponding compensation for owners and local administrations.
• Pending resolution: municipal observations regarding fencing and temporary roads are not closed; their final resolution depends on the corresponding environmental channels, which may affect execution timelines.

Who does it affect?

• Repsol Generación Eléctrica, SAU: authorization holder, responsible for compliance with all technical and environmental conditions.
• Red Eléctrica de España: transmits to Repsol the ownership of the 220 kV line removed from the transport network.
• Municipality of San Miguel de Aguayo: directly affected municipality; has raised observations regarding fencing and temporary roads.
• Municipality of Bárcena de Pie de Concha: likewise, with observations pending final resolution.
• Municipality of Molledo: likewise, affected by project infrastructure.
• Land owners in affected municipalities: the declaration of public utility enables occupation procedures that may affect private properties.
• Electricity market operators: the operation of this storage capacity will have effects on the market for grid adjustment and balancing services.

Practical example

A reversible hydroelectric plant like Aguayo II acts as a large storage battery. With 1,181 MW of pumping capacity, the facility can absorb renewable generation surpluses (wind or solar) by pumping water to the upper reservoir. When the system needs energy, it turbines that water generating up to 1,014 MW of electrical power.

For an electricity market operator, this means that Repsol will be able to offer regulation and balancing services to Red Eléctrica with capacity equivalent to that of a medium-sized nuclear plant. The removal of the 220 kV line ensures direct evacuation of that energy without depending on the transport network managed by the system operator.

For land owners in San Miguel de Aguayo, Bárcena de Pie de Concha or Molledo, the declaration of public utility means that Repsol can initiate occupation proceedings. If a property owner has land in the affected area, they should be alert to notifications of expropriation or easement procedures that may result from this resolution.

What should companies do now?

1. Repsol Generación Eléctrica: review and comply with all technical conditions required by sectoral bodies and the environmental impact statement approved in 2020 before starting works.
2. Repsol Generación Eléctrica: manage the formal transmission of the 220 kV line from Red Eléctrica, completing the administrative procedures for removal from the network.
3. Municipalities of San Miguel de Aguayo, Bárcena de Pie de Concha and Molledo: activate the corresponding environmental channels to resolve pending observations regarding fencing and temporary roads, to avoid blocking the construction schedule.
4. Affected land owners: check if their properties are included in the scope of the declaration of public utility and, if so, seek advice on their rights in the occupation procedure.
5. Electricity market operators and competitors: incorporate the future capacity of Aguayo II in their generation and storage planning models, given the impact it will have on adjustment and balancing service markets.

Official source

Consult complete regulation in official source

Notice: This article is for informational purposes only and does not constitute legal advice. For specific decisions, consult a qualified professional. Source: https://www.boe.es/diario_boe/txt.php?id=BOE-A-2026-13934