Spain has a solid regulatory framework to electrify its economy, but actual deployment is lagging. Networks, storage, and the price gap between electricity and gas are the main barriers.
According to El Periódico de la Energía, Spain has a favourable base for electrifying its economy, although it has yet to translate its regulatory advances into effective deployment. The diagnosis comes from the Electrification Competitiveness Index, developed by We Mean Business Coalition with the support of RMI, which analyses the readiness of 16 countries to replace fossil fuel technologies with electric alternatives.
The report gives Spain 77 points out of 100 in policies and enabling conditions, compared to 52 points in effective deployment. The country shares with China and France the group of economies with a solid base. Clean generation accounts for 75% of Spain's electricity, and the electricity market is liberalised.
The study identifies three challenges: correcting the price difference between electricity and gas, aligning network development with demand growth, and setting more concrete electrification targets by sector.
In networks and the electricity market, Spain scores 13 points out of 30 in implementation, compared to 23 out of 30 in enabling conditions. The document acknowledges progress in forward planning and flexible connections but warns that available capacity and its allocation remain a problem for industry, data centres, and storage.
To prevent networks from hindering electrification, the report recommends coordinating investments in transport and distribution with storage, demand flexibility, and new clean generation. It also calls for more transparency about available capacity and clear criteria for prioritising connections. It cites the €17 billion investment planned in the electricity grid plan until 2030 and the Dynamic Line Rating systems deployed in the Balearic Islands as examples of leveraging existing infrastructure.
Storage is another weak point. Its installed capacity accounts for less than 1% of the total generation of the system, according to the indicator used by the study. The report calls for aligning its deployment goals with network availability and advancing the launch of the capacity market.
In industry, Spain scores 15 points out of 20 in deployment and 20 out of 20 in enabling conditions. The study highlights the PERTE for Industrial Decarbonisation, the National Energy Efficiency Fund, and the increased number of projects submitted in the IF25 industrial heat auction. Nevertheless, the price difference between electricity and gas continues to undermine the profitability of replacing thermal equipment with electric alternatives, prompting the document to call for enhanced support to move projects from the development phase to commercial execution.
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