Renewables shield Spanish consumers from elevated gas prices

This report by Ember analyzes how Spain's strategic expansion of renewable energy has decoupled electricity prices from volatile gas prices, shielding consumers during the 2026 energy crisis triggered by the US-Israel war with Iran. It details the reduction in gas influence on power prices, the resulting savings for typical households, and policy responses following the April 2025 Iberian blackout to improve grid resilience and electrification.

• The influence of gas on Spanish electricity prices has decreased significantly between 2021 and 2026. In 2021, gas influenced power prices for an estimated 52% of hours, but this dropped to only 9% of hours in the first five months of 2026, primarily due to a 37% increase in wind and solar generation between 2021 and 2025.
• Spain and Portugal consistently ranked among the three EU countries with the lowest day-ahead electricity prices during the first four months of 2026. In March 2026, electricity prices in Italy averaged €143/MWh, which was three times higher than the €42/MWh recorded in Spain.
• A typical Spanish household on a regulated tariff saved an estimated €10 per month in electricity bills during the 2026 crisis because of the decoupling of power and gas prices. This represents a 19% saving compared to a scenario where electricity prices remained as strongly linked to gas as they were in 2021.
• While wholesale market shielding saved consumers money, these gains were partially offset by rising grid balancing costs. Between 2021 and 2025, the annual cost of grid balancing rose from €1.3 billion to €3.8 billion, and renewables curtailment increased from 0.1 TWh to 4.6 TWh.
• Following the Iberian blackout of April 28, 2025, Spain implemented reforms to improve grid stability, including requiring renewable power plants to provide dynamic voltage control. As of May 2026, 6 GW of renewables were providing these services, which were previously the exclusive domain of conventional power plants.
• Spain maintained strong renewable growth after the 2025 blackout, adding an average of 1.3 GW of wind and solar capacity per month between May 2025 and February 2026. Additionally, the installed capacity of large batteries in Spain quadrupled in 2025 and is expected to quadruple again in 2026.
• To encourage electrification and reduce fossil import dependency—which stands at 71% in Spain compared to 57% for the EU—the government implemented temporary tax cuts ending June 1, 2026. These included reducing VAT on electricity from 21% to 10% and cutting the special electricity tax from 5.1% to 0.5%, removing €8 from the typical monthly bill.

APA

Rosslowe, D. C. (2026). Renewables shield Spanish consumers from elevated gas prices. Ember. https://ember-energy.org/app/uploads/2026/06/Report-PDF-Renewables-shield-Spanish-consumers-from-elevated-gas-prices.pdf

Chicago

Rosslowe, Dr Chris. Renewables shield Spanish consumers from elevated gas prices. Ember, 2026. https://ember-energy.org/app/uploads/2026/06/Report-PDF-Renewables-shield-Spanish-consumers-from-elevated-gas-prices.pdf.

Wikipedia

{{cite report |last1=Rosslowe |first1=Dr Chris |title=Renewables shield Spanish consumers from elevated gas prices |publisher=Ember |date=16 June 2026 |url=https://ember-energy.org/app/uploads/2026/06/Report-PDF-Renewables-shield-Spanish-consumers-from-elevated-gas-prices.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{rosslowe2026renewables, author = {Rosslowe, Dr Chris}, title = {{Renewables shield Spanish consumers from elevated gas prices}}, institution = {Ember}, year = {2026}, month = jun, url = {https://ember-energy.org/app/uploads/2026/06/Report-PDF-Renewables-shield-Spanish-consumers-from-elevated-gas-prices.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }