Stock Markets February 26, 2026

EDP stakes a claim in Iberian data centre boom on the back of relatively low power costs

Portugal’s biggest utility is moving to supply expanding data centre capacity in Spain and Portugal, citing structurally affordable electricity and new regulatory clarity

By Maya Rios
EDP stakes a claim in Iberian data centre boom on the back of relatively low power costs

EDP is positioning itself to supply a large pipeline of data centre projects across the Iberian Peninsula by leveraging what it describes as structurally low electricity prices and clarified regulatory returns. The company has signed a renewable power supply partnership for a 1.2-GW site in Sines and projects steady electricity demand growth in the region through 2030.

Key Points

  • EDP is actively engaging with a pipeline of over 18 GW of data centre projects in Portugal and Spain, positioning itself as a key power supplier for the sector.
  • The company signed a renewable power supply partnership for the 1.2-GW Start Campus data centre project in Sines, developed by Pioneer Point Partners and Davidson Kempner.
  • EDP cites structural factors supporting relatively affordable electricity prices in Iberia and regulatory returns that provide investment clarity - Portugal: 6.7% pre-tax return through 2029; Spain: 6.58% through 2031.

EDP, Portugal's largest utility, says it is preparing to serve a rapidly expanding roster of data centre developments in Iberia, attracted by electricity prices it expects to remain comparatively low versus much of Europe, CEO Miguel Stilwell de Andrade said on Thursday.

Speaking at an analysts' conference, Stilwell de Andrade pointed to an extensive pipeline of data centre capacity across Portugal and Spain - more than 18 gigawatts of projects either in development or already in the pipeline - and described the cluster as an important contributor to rising electricity demand in the region.

"EDP is obviously engaging with many of these projects," the CEO said, underlining the company's commercial interest in supplying power to that segment.

Stilwell de Andrade highlighted Iberia's relative cost advantage for these large electricity users, saying the region's "distinctive advantage" is - structurally affordable power prices. He said that affordability is a crucial factor for data centre developers when choosing locations.

Confirming EDP's active role in the market, the company on Wednesday signed a renewable power supply partnership for a major data centre development in Sines, 150 kilometres south of Lisbon. The contract covers a 1.2-GW site being developed by Start Campus, a consortium made up of Britain's Pioneer Point Partners and U.S. fund Davidson Kempner.

Stilwell de Andrade noted recent demand trends to illustrate the momentum behind the sector. Electricity consumption rose 3.6% in Portugal and 2.8% in Spain in 2025, outperforming most EU markets where average growth was around 0.4%, he said.

Looking ahead, EDP is forecasting average annual demand growth of roughly 2% across Iberia through 2030. The company attributes that growth to broader electrification trends - notably in transport and industry - in addition to the impact of data centres.

On the policy side, Stilwell de Andrade pointed to a set of structural elements that he believes will help keep prices relatively low. One of those is the scheduled full repayment of the electricity systems tariff debt by 2028, a legacy item the CEO said has weighed on consumer bills and which he expects will result in cost reductions in the tariff structure going forward.

Another stabilising factor, he said, is the regulatory framework setting out allowed pre-tax returns on electricity network investments: 6.7% in Portugal through 2029 and 6.58% in Spain through 2031. Stilwell de Andrade described these parameters as providing clarity and stability for EDP's forthcoming investment cycle.


As EDP broadens its commercial outreach to hyperscale and other data centre customers, the company is relying on a combination of demand growth, competitive power pricing and defined regulatory returns to underpin its strategy in Iberia.

Risks

  • Projected demand growth of about 2% annually through 2030 is a forecast and may not materialise as expected, which could affect investment plans and power-offtake agreements - impacts credit, utilities and power markets.
  • The expectation that electricity prices will remain structurally affordable depends in part on the planned full repayment of the electricity systems tariff debt by 2028; changes to that schedule or its effects could alter tariff dynamics - impacts consumers and energy sector revenues.
  • Regulatory guarantees on allowed pre-tax returns are defined only through specific years (Portugal through 2029 and Spain through 2031), which leaves uncertainty beyond those horizons for network investment returns - impacts network operators and long-term investors.

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