The EC has approved Spain’s €9 billion electricity supply security support scheme

The European Commission (EC) has approved a €9 billion Spanish scheme to secure the electricity supply. This is stated in a press release from the institution.

This state aid measure is intended to ensure sufficient capacity for the production, storage, or flexible consumption of electricity, as well as to align electricity production volumes with expected demand.

The measure will be in effect for 10 years, starting in May 2026.

The mechanism is open to all existing or new projects that ensure electricity availability during periods of shortage. These include electricity generation, demand response, and energy storage. Beneficiaries will be selected through tender procedures. The measure’s budget is estimated at approximately €900 million per year, which will constitute the total amount for the ten-year period, depending on the results of each capacity auction.

Under the proposed market-wide mechanism, the transmission system operator will compensate for all the capacity needed to meet the established reliability standard—that is, the maximum allowable number of hours of load loss per year that the grid must guarantee to ensure adequate security of supply.

The initiative will be open to projects located in Spain. The country will seek to ensure the participation of all other interconnected member states as soon as possible.

As a reminder, the European Commission has approved a €1.3 billion German state aid scheme for renewable hydrogen production. The approved program provides support for the construction of up to 1 GW of installed electrolyzer capacity and the production of up to 10 million tons of renewable hydrogen. According to the EC’s estimates, this will help avoid up to 55 million tons of CO2 emissions.