Nobody Expected The Spanish (Energy) Transition!
The grid in Madrid is where prices have slid.
As we like reminding you, with Donald Trump trying to kill clean energy, Europe has become the source of much of our clean energy Nice Times lately. Here’s one more example: Spain is among the big sleeper hits on Europe’s energy transition pop chart. In just a decade, Spain has ramped up its use of wind and solar power, resulting in some of the lowest wholesale electricity prices on the continent.
Oxford prof and energy policy analyst Jan Rosenow gets into the details at his “Bright Spots” newsletter, which we’ll recommend for folks who need a dose of climate optimism about now:
In the first four months of 2026, the average wholesale electricity price in Spain was €44 per megawatt-hour. In Italy, it was €127. In Germany, €96. In the UK, €103. Spain is now cheaper than France, well below the central-European bloc, and within striking distance of the Nordic hydro-and-nuclear heavyweights that have always topped the cheap-power league.
The basic reason is pretty simple, Rosenow explains, although he also goes into further detail beyond this. “Spain increasingly pushed gas increasingly out of its electricity supply, and the price of electricity followed.”
Over the last 25 years, Spain has gone from getting a third of its electricity from coal to effectively having zero coal power. Spain replaced most of that capacity with cheaper (and relatively cleaner but still climate-unfriendly) fossil gas, and it’s now replacing gas with renewables. Gas peaked at about 30 percent of Spain’s energy mix near the end of the 2000s, and is now down to about 19 percent. Another 19 percent comes from nuclear, which hasn’t changed over the last few decades and 14 percent is from hydro and bioenergy. The rest has been solar and wind, which combined are up to 42 percent of the mix in 2026. Here’s a pretty chart, with cheerful yellow solar energy and cool blue wind energy growing, and icky grey coal rapidly fading into nothing.
Here’s why the replacement of gas with renewables matters so much: Because wholesale electricity prices at any given time are set by the most expensive energy plants needed to meet demand, and gas is usually that most expensive source, getting more solar and wind on the grid during high-demand daylight hours brings down wholesale prices a lot. (snip-MORE)
Go and read, and click the links if you have time. It is heartening, even though it’s not happening here.
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