The Spanish government has unveiled a €5 billion anti-crisis package aimed at supporting industry and mitigating the impact of rising energy costs driven by geopolitical tensions.
According to official data, electricity price volatility linked to Middle East tensions has significantly increased production costs, particularly for energy-intensive sectors such as steel.
Short-term relief measures
The package introduces immediate support, including:
- VAT on energy reduced from 21% to 10% until June 2028
- Cuts to hydrocarbon and electricity taxes
- Financial aid for companies affected by trade disruptions
Strategic transformation focus
Spain also plans to accelerate industrial transformation through:
- New strategic investment projects for reindustrialization
- Support for supply chain resilience and digital transition
Renewable push and electrification
Renewables now account for around 60% of Spain’s electricity mix, reducing dependence on fossil fuels. However, external energy reliance still stands at 67–70%, highlighting ongoing vulnerabilities.
Steel sector response
Steel association UNESID warned that energy costs have raised production expenses by up to 25%, calling for:
- Long-term structural energy reforms
- Stable and competitive pricing to sustain investment and decarbonization
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