Spanish Electricity Network Collapse Threatens Industrial Decarbonisation and Infrastructure Expansion

The Spanish electrical grid is currently facing an unprecedented collapse severely restricting the ability to admit new connection requests for households data centres and industrial facilities.

Large energy companies have issued warnings to the government and regulators about the urgent need to overhaul planning and reinforcement procedures highlighting that the transport and distribution network is reaching its maximum capacity in numerous areas.

If corrective action is not taken swiftly the network risks becoming permanently closed to new projects. This concern is compounded by criticisms directed at Red Electrica (REE) which has historically invested below its allowed maximum and bureaucratic delays that hinder the realisation of planned infrastructure upgrades.

The issue is no longer solely about available capacity but also about the system's inability to respond promptly when new high-demand zones emerge particularly those involving digital infrastructure and industries that did not previously exist there. Industry sources argue that despite well-designed plans execution delays have hampered progress often relying on past projects to be completed before new ones are initiated.

This situation coincides with a review of access frameworks and recent measures aimed at reducing blackout risks. The National Commission on Markets and Competition (CNMC) is considering delaying the publication of capacity maps by three months moving from February to May 2026 to allow technical parameters to be addressed properly before data is made public.

This delay is seen as a window for negotiations with REE to develop practical solutions while two critical bottlenecks are being addressed agreeing on reference values at border points between transport and distribution and managing the impact of the so-called dynamic criterion which effectively tightens available capacity calculations.

The implementation of the dynamic criterion under discussion for almost four years has exposed the deep cracks within the sector revealing a structure prone to administrative and technical blockages. Industry stakeholders are calling for a more agile approach to planning and connection management especially in light of accelerated digitalisation and decentralised energy initiatives.

Recent legislative changes introduce mechanisms to swiftly modify the purpose of substation positions or to add new ones when demand exceeds available infrastructure. These modifications aim to reduce planning delays from up to two years to a maximum of two months thus enabling more rapid responses to emerging needs.

However these measures are challenged by ongoing investment limits. Transport infrastructure is capped at a 0.065 per cent of GDP annual investment and companies claim slow execution delays threaten to undermine expansion plans impacting areas such as Costa del Sol and Estepona where infrastructure upgrades are overdue.

Data centre growth exacerbates the urgency with industry calls for accelerated network investments to prevent digital projects from stalling due to lack of capacity. The saturation in distribution networks already results in the rejection of many connection requests risking limitations on future digital and industrial expansion.

The immediate challenge is to unlock short-term capacity by increasing construction speed and reordering existing infrastructure such as station positions without being constrained by administrative labels. Regulators and REE face the task of balancing urgent expansion with safety coordination and transparent access criteria.

In the upcoming months the sector will closely monitor the impact of the CNMC's capacity map delay and legislative procedures to alter the purpose of infrastructure points. Failure to deliver tangible improvements risks establishing a de facto deadlock where projects are ready but the electrical network remains essentially shut to new demand threatening the countrys economic and technological growth prospects.