The average price of energy on the OMIE daily market doubled during March 2025 compared to the same month the previous year, in both Spain and Portugal. According to official data, the monthly average in Spain reached 53.03/MWh , representing an increase of 161% compared to 20.28/MWh in March 2024 .
In the case of Portugal, the variation was even more significant: from 19.26/MWh to 52.53/MWh , an increase of 172.7%. This trend was also reflected in maximum prices, which rose from 173.82/MWh to 197.25/MWh in both countries. The minimum values, for their part, marked a substantial difference: while in March 2024 no prices below zero were recorded, in March 2025 hourly sections with negative prices were observed, reaching -5.21 /MWh in Spain and -4.00 /MWh in Portugal. Consulted by Strategic Energy Europe, Kim Keats Martínez, director of K4K Training & Advisory and EKON Strategy Consulting, explains that the main cause of the price increase was the low availability of renewable generation during the month. According to the report, March saw atypical weather conditions: cloudy skies, light wind, and frequent rainfall.
This situation forced greater use of thermal technology to meet demand, thus widening the thermal gap and raising average prices. "The Azores anticyclone wasn't pushing the storms northward, as is usually the case, but rather allowed them to enter through the South Atlantic, directly affecting the Peninsula," he describes. This situation resulted in a stable and humid atmosphere, with little solar radiation and little wind, conditions that limited the renewable energy supply. The specialist warns that the widespread perception in the sector was of temporary price relief, but maintains that this interpretation can be misleading. In his opinion, what's coming is a spring marked by extreme prices and increased stress on the system. "Prices will continue to fall, but not for good reasons," he notes. One of the most relevant side effects of the current context is the increasingly frequent appearance of hours with zero or negative prices. According to Keats Martinez, several days have already been recorded with five or six consecutive hours under these conditions. REER phenomenon This phenomenon has direct implications for renewable energy plants operating under a specific regime, because when negative hours extend for more than six consecutive time periods, legislation prevents that energy from being counted as effective production. This restriction jeopardizes compliance with the required minimum annual energy threshold, which could result in financial penalties. "It's as if nothing had happened during those hours," explains Keats Martínez, who notes with concern that these types of events, once rare, are beginning to become routine. Furthermore, he emphasizes that these hours of negative prices coincide with peak renewable energy generation, especially solar energy, which exacerbates the wastewater problem. In this regard, the average renewable energy output in 2024 is estimated to be 2%, but projections for this year indicate that this figure could reach 5%, in line with the increase in installed solar capacity. "We're talking about 6 or 7 GW at noon that have nowhere to go," he warns. The market's performance in April also raises expectations.
Keats points out that April 2024 was the month with the lowest average price of the year and believes it is likely that, if similar weather conditions are repeated, the system will face an even more difficult situation. "This is going to get worse," he concludes. Regarding Portugal, the expert highlights that its greater share of wind power gives it a comparative advantage over Spain. "They have much more wind capacity than solar, and that partially protects them," he argues.
He also points out that renewable development in the neighboring country has been more moderate and orderly, which has allowed for better management of integration into the system. In Keats's view, a more balanced resource mix and a more cautious approach to growth have allowed Portugal to move forward without generating the strains currently seen in the Spanish electricity system. With an increasingly saturated electricity system and a price curve that oscillates between extremes, the Iberian market is entering a period of transformation that will require both regulatory and technological adjustments. For Keats, the message is clear: "We can't keep adding capacity without waiting for prices to respond.
The addition of storage and hybridization of wind farms are essential."