Spain | More renewables to continue lowering costs

Summary

The increased penetration of renewable energies in Spain, especially solar and wind, has reduced wholesale electricity prices by 20% in the last three years and could cut them by a further 20% by 2030 if the ambitious PNIEC targets are met.

Key points

• Key points:
• Renewables contribute to lower electricity prices despite their dependence on weather conditions and the current lack of energy storage.
• From 2021 to 2024, the remarkable 20 percentage point increase in the share of renewables, driven by solar and wind, reduced wholesale electricity prices in Spain by almost 20%.
• Lower energy prices have reduced the unit revenues of solar and wind, especially in the case of solar. However, there is no clear evidence that lower energy prices are deterring investment in renewables (a phenomenon called ‘cannibalisation’).
• Looking ahead, meeting the ambitious PNIEC targets could reduce prices by another 20%.

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