Spain to Require Dedicated Renewable Power for AI Data Centers

Spain is emerging as a leader in data center development in southern Europe, driven by the AI boom, but the government wants to make sure that wave of projects doesn't come at any cost. The cabinet is finalizing a royal decree that will require data centers with a grid connection of at least 1 MW to cover 80% of their electricity consumption through renewable self-generation or power purchase agreements (PPAs) tied to new Spanish renewable plants, which must have come online no more than 18 months before the data center starts operating.

The most contested clause: hourly correlation

Buying a lot of green electricity on an annual basis isn't enough: the most debated requirement is so-called hourly correlation, which mandates that in every single hour, at least 80% of the electricity consumed by the data center be backed by renewable electricity generated in that same hour. That's where the real problem lies: a data center runs 24 hours a day, but the sun doesn't shine at night and the wind doesn't blow on demand. The industry argues that meeting this condition would sharply raise costs for some projects, or make them outright unviable without additional backup capacity.

Twelve gigawatts already committed to the grid

The scale of the phenomenon is already visible on the grid: operator Red Eléctrica has granted more than 6 GW of connection capacity to data centers on the transmission network, plus roughly another 6 GW granted in distribution since 2020. That's about 12 GW of capacity already committed, compared with the 3.5-4 GW of electricity demand Spain's national AI strategy had projected for the whole sector by 2030. Red Eléctrica confirms that consumption from IT infrastructure activities has posted year-on-year growth above 75% in some months.

Tripling data center capacity amid a water and climate emergency like the one Europe is experiencing is an environmental absurdity and a social irresponsibility.

Who ends up paying the electricity bill

A data center's power consumption is enormous, continuous and largely inflexible. If accommodating these projects requires building more distribution grids, more generation plants and more backup capacity — including gas if renewables fall short — part of that cost could end up passed on to household bills. The draft decree itself acknowledges the risk: disorderly growth could increase reliance on gas as a marginal power source, and with it, electricity prices for every consumer. That's exactly what has already happened in the United States, where these centers have pushed up electricity bills for residents in the areas where they've been built.

€67 billion in investment, and the water front

Industry group Spain DC estimates the sector could mobilize close to €67 billion in investment in Spain by 2030. In parallel, the European Commission presented its Cloud and AI Development Act (CADA) in June, aiming to triple the EU's data center capacity within 5 to 7 years by speeding up permits and easing access to energy, land and water. The European Environment Agency, however, warns of the water footprint of this infrastructure, tied mainly to the electricity generation that powers it, but also to cooling and semiconductor manufacturing. Spain DC counters that growth in digital capacity doesn't require a proportional rise in water consumption, and points to dry cooling, closed-loop systems, free cooling and reclaimed water as the main levers for reduction — while acknowledging that dry cooling can require more electricity during extreme heat events.

• 80% of electricity consumption must be covered by dedicated renewables, with hourly correlation
• About 12 GW of capacity already granted, versus 3.5-4 GW projected for 2030
• €67 billion in investment estimated by Spain DC through 2030
• The EU's CADA law aims to triple the bloc's data center capacity within 5-7 years

What this means for Spain, and beyond

For a consumer, the outcome will hinge on how the ongoing regulatory tug-of-war is resolved: after receiving industry objections, the government says it's willing to soften some points of the decree, while insisting it won't give up on protecting the grid and electricity prices. Tech companies, utilities and investors see the hour-by-hour correlation requirement as especially hard to meet, and the final version of the rule will determine whether Spain can attract AI infrastructure investment without shifting the cost onto households, as has happened in the United States. Abundant, competitively priced renewables, available land and strong connectivity explain why the country has become a central piece of AI compute deployment in southern Europe; how this decree plays out, closely watched by other EU countries as they implement the CADA law, will show whether that leadership can be built without worsening the water and energy stress that already worries Greenpeace and the European Environment Agency itself.