Portugal, Italy & Spain domestic and commercial heating & hot water provision

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19 January 2026
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Chris Goggin looks at the modes and methods of heating and hot water provision to domestic and commercial properties in the Latin Euro countries - Spain, Portugal, and Italy. A comparative analysis of national approaches will demonstrate how each economy is making progress in their NetZero targets and how properties in each country uses energy and appliances.

 

Each EU state is legally required to reduce emissions by the year 2050, yet each European country will face individual pathways of decarbonisation due to the separate geographical, geopolitical, and financial status of the respective examined economies. Current European law ensures that every member state must contribute towards the EU becoming climate neutral by 2050 whilst reducing net emissions by 55% by 2030.

To put the progress of Spain, Portugal, and Italy into context, it is worth mentioning the advancement of the world’s leading nation in terms of clean electricity introduction - China.

Clean Chinese electrical generation is advancing far beyond any other nation with rapid construction of multiple renewable installations. The Guardian newspaper reported in June 2025, that China had installed 93GW of solar capacity in May 2025 “100 solar panels every second.” Between January and May 2025, China had included 198GW of solar and 46GW of wind capacity into domestic operations, producing as much electricity as Turkey or Indonesia.

In Spain, its housing stock consists of around twenty-seven million dwellings and can be considered old. Ninety-five percent of Spain’s housing stock was built before 2009 – 22% of which were constructed between 2000 and 2009. This results in many buildings being more suitable towards traditional methods of heating and hot water production, such as gas and electricity.

There are four differing climates in which building stock must accommodate towards: inland, centrally positioned areas experience extreme conditions - very cold winters and intense summers. The southern coast region also has hot and dry summers with milder winter months. The Northern coast is more comparable towards Western European countries that have plentiful rain, cooler summers, and mild winters. The Mediterranean coast also has mild winters with summers that are not as intense as inland areas.

The effect this has on choices of heating and hot water means that different options are more suitable towards the region that you preside in. However, as Spain consists of old housing and building stock traditional avenues of heating and hot water are primarily used.

Natural gas is the most common energy used in Spanish homes, of which around 40% use natural gas as the main source of energy. Thirty percent of Spanish building stock relies on electricity to deliver heating and hot water to domestic and commercial buildings, making electricity the second in demand energy in Spain. Seventeen percent of Spanish properties employ renewables as a main provider of heat and hot water.

Renewables are a fast-growing source of domestic and commercial power in Spain, renewables expanded by 15.1% in 2023 and is responsible for 50.3% of domestic power generation. Wind is the biggest contributor to this statistic accounting for 23.5% of electrical power, whilst nuclear is second at 20.3%, combined cycle power plants are the third largest provider of electricity at 17.3%. Solar PV is fourth, responsible for 14% of clean fuel.

Heat pumps installations are also gaining traction, in 2022 185,000 heat pumps were sold across Spain – a 24% increase from the previous year. The total amount of installed units that are spread across Spanish regions is around 1.28 million. This is equal to 29 people out of 1,000 owning a heat pump.

Western neighbours to Spain, Portugal – have 3.6 million buildings and a further six million residential dwellings. Portugal's population is estimated to be in between 10.4 and 10.8 million people. Like Spain, the Portuguese weather system also differs from the cooler north to the hotter south. Despite separate climates in Portugal’s regions, a shared and successful approach has been adopted towards Portuguese renewable power production.

Portugal is a European leader in providing renewable energy to its citizens and has outlawed coal-fired power since 2021. Portugal has electrified its domestic power and relies on natural and clean resources to power the country. It could be argued that Portugal is the European leader regarding domestically incorporating renewables.

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In 2024 renewables as an umbrella term accounted for 71% of national electricity consumption and has been driven by an expansion of solar PV and hydropower capacity. The primary components of Portugal’s energy mix that created electricity in 2024 consisted of hydropower 28%, wind energy 27%, solar PV energy 10% and biomass energy 6%.

To achieve a high percentage of domestic renewable electricity generation Portugal has significantly increased renewable power production. Solar PV energy has undergone a yearly growth of 37% by integration of new infrastructure into the national grid whilst hydropower also made a substantial impact recording a 24% annual increase.

Portugal has gone from 27% renewable electricity production in 2005, 54% in 2017 and now, as mentioned earlier 71% in 2024. In April 2024 ,95% of all electricity produced in Portugal derived directly from renewable sources. Portugal has also been documented as producing enough renewable energy to supply electricity for six straight days. This means that 100% of Portugal’s power requirements were met by clean energy only during that period.

Other forms of energy assist in providing domestic and commercial heating and hot water. Portugal still has 1.5 million households that use a gas boiler for heating whilst heat pump usage is also rising. 40,000 heat pump units were sold and installed in 2022, an increase of 24% from the previous year. There are twenty-seven heat pumps in use every one thousand people across Portugal.

Italy has around thirty-five million dwellings whilst commercial properties are thought to make up 7% of Italy’s total property market. A north-south divide in terms of climate is also apparent. The Mediterranean south experiences hot and dry summers with wet and mild winters whilst the north also has hot summers but with a colder and wetter winter period. Italy’s Alps region will maintain regular snow fall throughout the winter months and have a warmer and wetter spring as well as summer.

Most of Italy’s power still derives from natural gas usage and fossil fuels – according to statistics released by the European Commission around seventeen million households used gas as a primary source of heat and hot water in 2022. In 2024, 51% of electrical production was still reliant on fossil fuels.

However, gas use is falling – it has been reported by global news agency Reuters that Italy’s gas consumption has fallen to the lowest levels in 15 years, recording an annual drop of 2.5%.

Renewables are becoming a key part of the Italian energy mix, by 2030 Italy is working towards a target of 69% renewably generated electricity. In 2024 Italy experienced a 13% increase in renewable production which covered 41% of domestic power demand. In 2023 Italy’s renewable contribution covered 37% of Italian power demand also highlighting an annual expansion. Both hydropower and solar energy were increased by 30% and 19% respectively but wind extraction had a 5.6% decrease due to below average wind conditions.

According to data released on the Statista website Solar power in Italy is used by over 1.6 million dwellings across the country in 2024, up from over 1.3 million in 2023. Residential solar have experienced a 10-fold increase since 2010.

Italy's heat pump use assists in Italy’s provision of heating and hot water in both domestic and commercial properties. 515,000 heat pumps were sold in 2022, an increase of 35% compared to the previous year. Italy now has a total of reaching a total stock of around 3.25 million installed heat pumps, equivalent to fifty-five residents out of one thousand owning and operating an active heat pump unit.

All countries Spain, Portugal and Italy still incorporate fossil fuels into their energy mix but are all shifting towards cleaner energies, more notably carbon neutral electrification. Heat pump sales are an accepted technology across all three countries whilst solar is a viable option in Italy yet is not viewed as an ideal technology to Spanish or Portuguese customers.

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