By Minener Editorial Team | May 2025
Global investment bank Goldman Sachs has issued a stark warning about Spain’s energy policy following the massive blackout on April 28. In its latest report titled “Why Blackouts Matter: A Major Shift in Spanish Energy Policy Is Coming,” the U.S. financial giant urges Spain to undertake urgent and expensive reforms to restore credibility in its energy system.
According to the report, the Spanish government will need to:
- Increase investment in electricity grid infrastructure,
- Accelerate battery storage capabilities,
- Temporarily slow down the deployment of solar projects, and
- Extend the lifespan of nuclear power plants.
April 28 Blackout: A Blow to Investor Confidence
The nationwide blackout hit major regions including Madrid, Catalonia, Valencia, and Andalusia. Triggered by a cascading failure in Spain’s high-voltage transmission grid, the outage only lasted a few hours, but its reputational damage was swift and global. Spain is now seen as an unreliable destination for energy-intensive industries and technology giants.
Tech leaders such as Amazon, Microsoft, and Google—who have announced major data center investments in Madrid and Aragón—require uninterrupted power. The blackout raised alarms among foreign investors, many of whom are now reconsidering plans or eyeing alternative locations in Europe with more resilient infrastructure.
Energy Policy Under Fire: Transition Without a Safety Net
Spain’s energy transition under Prime Minister Pedro Sánchez has been rapid, closing coal and nuclear plants while ramping up renewables in line with EU Green Deal goals. But critics argue that this shift has outpaced the country’s technical and logistical capacity to support it.
Under Minister Sara Aagesen, the Ministry for the Ecological Transition is accused of prioritizing ideology over engineering. The result: an overloaded grid, insufficient backup capacity, and weak investment in energy storage. Without robust battery systems, renewables cannot provide reliable power during critical periods—exactly what failed on April 28.
Strategic Green Investments at Risk
The blackout threatens to derail major green and digital industrialization projects in Spain. Global headlines have amplified investor uncertainty about the country’s energy reliability. Key projects potentially impacted include:
- Volkswagen’s Gigafactory in Sagunto (Valencia):€4.5 billion investment in EV battery production, one of Europe’s largest industrial ventures.
- Amazon Web Services (AWS) in Aragón: €15.7 billion planned by 2033 to build a cloud data center region—one of Spain’s most ambitious tech initiatives.
- Microsoft: €2.1 billion for expanding data center operations in Madrid and other facilities by 2025.
- Google: Initial €650 million for data centers and offices in Madrid, with future growth expected.
- Envision AESC Gigafactory in Extremadura: €1 billion to supply Europe’s growing EV battery demand.
- EV component plants in Catalonia (LG Energy Solution, Seat-Cupra): Over €1.5 billion in direct investment and infrastructure.
These projects all depend on stable, clean, and uninterrupted electricity. Spain’s April 28 energy crisis—combined with surging wholesale power prices—undermines its competitiveness against countries like Portugal, Italy, or Poland, which now appear more secure and investor-friendly.