According to Ember Energy, Spain’s wind and solar growth has reduced the influence of fossil generators on the electricity price by 75% since 2019. As a result, the country’s wholesale electricity price was 32% lower than the EU average in the first half of 2025. During this time, other gas-reliant European countries have seen more modest price reductions, including the Netherlands (-34%), the United Kingdom (-32%) and Germany (-12%). The decrease in the influence of coal and gas generators on electricity prices was driven by Spain’s solar and wind growth. Between December 2019 and June 2025, the country doubled its wind and solar capacity, adding over 40 GW, more than any EU country except Germany – a power market twice the size.

Similarly, Portugal's high ​levels of renewable energy production should shelter it from the most severe ⁠impacts of increasing energy costs. In January and February of this year, about 79% of the electricity consumed in Portugal came ​from renewable sources. In Italy, in 2025, 41% of the country’s electricity consumption came from renewable sources and 85% of the country’s energy demand came from domestic production. 

Energy as a differentiator for real estate

For the real estate sector, in a more volatile geopolitical world, energy is now an additional differentiator. Higher domestic renewable penetration in Southern Europe should help dampen exposure to imported energy shocks and improve operating-cost visibility for office and logistics occupiers, supporting leasing decisions and business confidence in energy-sensitive sectors.

In 2025, Spain, Italy, Portugal and Greece saw real estate transaction volumes of €35 billion, an all-time high and 24% above 2024 levels, according to our research. We expect momentum in the region to continue this year, albeit at a more moderate pace. Investors aren’t just chasing a bounce in the South, they’re underwriting a cleaner demand story and a deeper opportunity set as the Mediterranean shifts from ‘satellite allocation’ to ‘strategic exposure’ in European portfolios. Its energy supply is another important pull-factor for the region.

Further information

Contact Silvia Manzoni or Lydia Brissy

Spotlight: Southern Europe Investment – 2026