Spain has long wrestled with steep electricity prices that press hard on heavy industry. The surge in costs, intensified by the energy crisis and the ongoing strain from geopolitical tensions, has squeezed margins and made competition with international peers tougher. As a result, some firms have slowed or halted production to stem losses.
For large industrial groups that rely on substantial electricity use where bills can represent half or more of total generation costs, policy responses are under intense scrutiny. The question is how to shape relief that truly eases the burden of electricity while preserving industrial capacity and jobs. In practical terms, these companies are planning not just for the current year but for the coming decade, seeking clarity on long term support mechanisms.
In March the European Commission gave the green light to Spain’s plan to provide aid totaling 2.9 billion euros to offset part of the costs tied to indirect CO2 emissions for the period from 2021 to 2030. Yet industry leaders argue that this amount does not keep pace with the current rise in CO2 emission rights and the allowances granted to other countries. For instance, Germany approved a plan that would compensate up to 27.5 billion euros over ten years. The gap between Spain’s commitment and broader EU actions remains a focal point in talks with Brussels. [Attribution: European Commission announcements and national briefings]
Representatives from the Large Energy Consumption Companies Association AEGE have pressed the government to push for a revision of the direct aid cap. They call for quadrupling the ceiling so that a total of 12 billion euros in compensation could flow to 2030. The goal is to ensure electro‑intensive producers receive adequate relief as energy prices stay elevated. Leadership from the industry group emphasizes a coordinated push to secure a more favorable framework in coordination with Brussels before year end. Official ministry spokespeople have not commented on the specifics of potential changes. [Attribution: AEGE statements and government briefings]
In a concise overview, the main players note that the grants may cover roughly three quarters of indirect costs, with a cap of a quarter of each country’s revenue from emission rights tenders to be allocated to electro‑intensive firms to finance the program. AEGE argues that current emission rights prices around eighty euros per tonne, well above pre pandemic levels, plus expectations of continued increases justify a higher Spain emissions plan. [Attribution: AEGE policy brief and market analyses]
Industry Minister Reyes Maroto and Vice President Teresa Ribera, who oversees Ecological Transition, met with industry representatives during a tour aimed at shaping contingency measures tied to energy efficiency commitments across Europe. The ministries have indicated that a contingency plan could include special measures for electro‑intensive industrial groups, though the exact content has yet to be announced. [Attribution: Ministry communications]
Recent government actions included an upgrade of 244 million euros in compensation for indirect CO2 costs for the preceding year, an increase of 65 million euros from the original estimate. This amount is the maximum that the European Commission allows the government to distribute among industrial groups. Looking ahead, AEGE estimates that offset costs from CO2 could range between 450 and 500 million euros. [Attribution: EC allowances and AEGE projections]
As part of extraordinary measures to ease the load from higher electricity costs, the government has temporarily reduced tolls by 80 percent. This relief is expected to apply to nearly 600 electricity‑intensive companies and is set to continue through the end of the year. AEGE has urged extending the reductions at least through 2023. The 80 percent toll cut is complemented by a permanent bonus: roughly 85 percent of invoiced charges, funded by the costs of regulated renewable energies, the system’s debt, and the extra costs of non‑peninsular regions, are allocated to all electricity‑intensive consumers. [Attribution: Government measures and AEGE commentary]
Overall, industry observers note that the current mix of aid and price signals will influence investment decisions, plant utilization, and future employment within energy‑intensive sectors. The outcome depends on how authorities balance direct subsidies, indirect CO2 cost coverage, and the evolving emission rights markets. Market watchers and policymakers continue to discuss how best to shield critical industrial capacity while maintaining EU climate objectives. [Attribution: industry analyses and regulatory filings]
Big industry remains focused on securing substantial financial support from both the government and the European Union to ease the impact of high electricity costs. The ongoing dialogue, regulatory reviews, and contingency planning are central to ensuring that electro‑intensive enterprises can sustain operations and contribute to economic resilience in Spain and the wider region. [Attribution: industry stakeholder statements]