Portugal to raise regulated power tariffs 2.7% on gas price surge

Portugal's electricity market regulator, ERSE, will raise regulated power tariffs by 2.7% for 779,000 households and small businesses starting October 1, after a jump in natural gas prices linked to the Iran-US conflict pushed wholesale electricity costs past its forecasts.

The adjustment follows a 1% increase in regulated electricity tariffs on January 1, which ERSE had expected to hold through 2026. In a statement, the regulator said that when it first set this year's tariffs it had been difficult to anticipate the scale of the surge in spot prices on MIBEL, the wholesale electricity market shared by Portugal and Spain.

ERSE attributed the spike largely to the effects of the US-Iran war, which lifted natural gas prices and, in turn, wholesale power prices. Spot prices on MIBEL have more than doubled from a year earlier, averaging €147.64 per megawatt hour so far in September against €64/MWh in September 2025, according to data from market operator OMIE.

Although hydro, wind and solar sources meet roughly 70% of demand, making Portugal one of Europe's most renewable-powered electricity systems, the country remains exposed to gas price swings because gas-fired plants often help set wholesale prices on the Iberian market.

The 779,000 customers on regulated tariffs account for only 4.6% of Portugal's total electricity consumption. Their influence extends further, however, because they can move between regulated and market-price contracts, prompting utilities to factor ERSE's rates into prices for their 5.7 million customers in the liberalised market.