BeClever, January 2025

Jonan Basterra22 January 2025·4 min read

Welcome to a new edition of BeClever, Clevergy's energy newsletter! We bring you the latest news from the energy sector at the start of this year.

2024: the year renewables reached a new milestone and energy demand rose

The past 2024 closed with an increase in renewable energy in Spain's generation mix, reaching 55.8% of the total, comfortably surpassing the 50.4% recorded in 2023. Last year wind power generated 22.9% of electricity, followed by nuclear with 19.6% and photovoltaic with 16.7%.

Energy generated from fossil fuels is declining: combined cycle drops to 13.2% of the total from 17.2% in 2023, and coal, which will disappear this 2025, falls from 1.5 to 1.1%.

As for electricity demand, 2024 closes in Spain with a 1.4% increase compared to 2023, after two years of decline.

Renewables are setting new milestones across Europe. In Portugal, renewables generated 71% of total consumption, with an increase in demand similar to Spain's, at 1.3%. In the United Kingdom wind power is now the leading source of energy with 29% of the total, while gas reaches its historic low in the year in which the last operating coal-fired power station was switched off in British territory.

Changes to regulated costs and VAT rise on electricity for 2025

The arrival of the new year also brings updates to electricity prices in Spain, resulting from the changes to regulated costs and the return of VAT to 21%. The changes to regulated costs make consumption more expensive during high-demand hours (peak) and favour that produced during lower-demand hours (mid and off-peak). The main increase in bills in 2025 will come from the return of VAT to 21%, after being reduced to 10% during 2023.

Opportunities for 2025: low prices for photovoltaic panels and replacement of gas boilers

News about the fall in the price of photovoltaic panels kept coming at the end of last year, to the point that manufacturers are looking for alternatives to aluminium, which is now the most expensive component of the panels.

Another good opportunity for installers will be the beginning of the end of gas boilers in Spain. Under European regulations gas boilers stopped receiving subsidies as of 1 January 2025, will no longer be installed in newly built buildings from 2026, will be removed from public buildings by 2028, and their use will be eliminated altogether between 2035 and 2040. Heat pump sales have grown significantly in recent years in Spain, although our country is still lagging behind the rest of Europe in the uptake of this type of device. According to data from the latest report published by EHPA (European Heat Pump Association), 210 thousand heat pumps were installed in Spain in 2023, although our country still ranks among the lowest in Europe in the number of new installations per 1,000 inhabitants.