Renewables have saved Europe €100mn every day since the start of the Iran war

Solar power has been saving Europe more than €100mn a day since the US-Israel war on Iran began, Euronews reports, as the Strait of Hormuz blockade transforms the economics of Europe's energy transition from a climate argument into an emergency security imperative.

The figure illustrates the tangible shield that existing renewable capacity has provided against an oil and gas shock that has already cost the European Union €24bn more than it had budgeted to spend on energy imports.

Fatih Birol, executive director of the International Energy Agency, has described Iran's blockade of the Strait of Hormuz and the associated assaults on Middle East energy infrastructure as the "biggest energy disruption in history." Goldman Sachs went further calling it the worst oil crisis in history.

Thanks to increased renewable capacity, electricity prices across 19 countries were on average 24.2% lower between 2023 and 2025 than they would otherwise have been. The three countries at the forefront of Europe's renewables push — Spain, France and Portugal — are now accelerating their clean energy programmes in direct response to the crisis.

Spain: the early mover

Between 2019 and 2026, Spain doubled its solar capacity to 40 gigawatts — more than any other EU country except Germany, whose power market is twice the size. That foresight has meant that Spaniards' electricity bills have remained among the lowest in Europe despite the Iran war severely disrupting energy supplies. In April Spain met its entire power demand using just renewables for the first time ever.

Spanish Economy Minister Carlos Cuerpo told CNBC that Spain had been better prepared for this crisis, pointing to the country's status as the fastest-growing advanced economy in Europe. Spain has since doubled down, publishing a Royal Decree on March 20 announcing measures to accelerate electrification, renewables deployment and storage, including cutting red tape, improving grid infrastructure and restricting data centres that cannot demonstrate sustainability credentials.

The country's renewables advantage carries a political bonus, immunising Madrid from Trump’s geopolitical bullying. The Trump administration pledged a trade retaliation against Madrid after Spain blocked two jointly operated military bases from being used in strikes against Iran — a decision made easier, analysts note, by the fact that Spain's energy exposure to Middle East supply chains is lower than most of its European peers.

France: €10bn electrification pledge

France has long been one of the green energy leaders following its decision in the mid1970s in the last big oil crisis to commit to nuclear power and start construction of a fleet of reactors that now provide 80% of the country’s power needs.

But it has not been sitting on its laurels. The government has promised €10bn of state support to switch households and businesses from oil and gas to electricity.

French Prime Minister Sébastien Lecornu was direct about the motivation: "Today 60% of our energy consumption comes from these imported fossil fuels, though our domestically produced power is three times cheaper. As long as we depend on oil and gas, we will continue to pay the price of other people's wars, which unfortunately will continue and will impoverish us."

France's plan includes installing an extra one million heat pumps per year and banning gas boilers in newly constructed buildings from 2027.

Portugal: price cap backstop

Portugal has promised to temporarily cap electricity prices if needed. The consumer protection mechanism would be triggered if retail electricity prices rise by more than 70% or exceed 2.5 times the five-year average, surpassing €180 per megawatt-hour.

The divergence between Europe's early renewables investors and those still reliant on imported gas is sharpening by the day. European gas prices are not expected to return to pre-conflict levels before 2027 at the earliest, according to analysts at Capstone DC, given the three-to-five-year timeline for repairing Qatar's Ras Laffan LNG plant – one of the three major sources for global LNG. For every day the Hormuz crisis continues, the €100mn daily solar dividend compounds — and the case for accelerating the transition that was already under way becomes harder to argue against.