New IEA report finds renewables are already strengthening energy security and competitiveness while cutting fuel import costs – but faster electrification, grid modernisation and greater flexibility can extend these gains across the economy
Spain’s rapid expansion of renewable power has strengthened its energy security and competitiveness, but faster electrification across transport, buildings and industry will be essential to meeting the country’s energy and climate goals, according to a new IEA Energy Policy Review published today.
Between 2015 and 2025, renewables’ share of Spain’s electricity generation increased from 35% to 56%, while emissions declined by around one-fifth. These achievements have been underpinned by the country’s strong energy and climate policy framework and its well-established approach to a just transition, which links clean energy investment with jobs, regional development and social inclusion.
Spain’s growing share of renewable power is already helping to lower wholesale electricity prices and reduce its exposure to imported fuels. Without the vast expansion of renewable capacity, its natural gas imports for power generation would have been nearly 40%, or USD 26 billion, higher in 2024. Nonetheless, imports still provided almost 70% of Spain’s total energy consumption in 2024, underscoring the need to extend the transition beyond electricity supply.
Accelerating electrification of end-uses should also be a priority, the report finds. Today, electricity accounts for just 25% of Spain’s final energy consumption, well below the country’s target of 35% by 2030. Electric vehicle uptake is relatively limited, notably for corporate fleets, while fossil-fuel heating remains widespread and industry faces high upfront investment costs.
A combination of taxes, levies and network charges are keeping end-user electricity prices high, while fossil fuels face comparatively lower charges in Spain. The country is taking steps to address this, including by abolishing the tax on electricity production in 2026. Further rebalancing domestic energy price dynamics, while protecting vulnerable consumers, could strengthen incentives for households and businesses to electrify, and help industry capture the competitive advantages of renewable power.
Spain has launched reforms to accelerate storage, demand-side flexibility, and adapt grid rules to a rapidly changing generation mix. Continued progress on power system infrastructure and management, alongside a more balanced mix of wind, solar and hybrid technologies, can help Spain integrate growing shares of renewable generation while strengthening electricity security and resilience.
The review also highlights the importance of carefully managing the planned nuclear phase-out to maintain security of supply. Following the recent approval to extend the lifetime operation of the Almaraz nuclear power plant, the report recommends implementing a transparent framework for future case-by-case decisions that considers the costs and benefits for consumers and the wider power system.
Strong progress on renewable power in Spain demonstrates that its deployment can advance energy security, competitiveness and social inclusion. The report finds that the next test will be to turn this progress into a fully integrated, flexible and resilient energy system. By accelerating electrification, modernising and optimising grids, unlocking flexibility and carefully managing its nuclear phase-out, Spain can offer valuable lessons for other countries pursuing similar energy transformations across the wider economy.