Portugal Raises Electricity Tariffs as Energy Costs Surge

Lisbon, September Portugal is preparing for higher regulated electricity prices after a sharp increase in wholesale energy costs pushed the country’s power regulator to approve a 2.7% tariff increase from October 1.

The increase, announced by Portugal’s Energy Services Regulatory Authority (ERSE), will initially affect around 779,000 households and small businesses that remain on regulated electricity contracts. The regulator said the adjustment was necessary because wholesale electricity prices have risen significantly beyond the levels anticipated when 2026 tariffs were originally established.

A major factor behind the increase has been the surge in natural-gas prices associated with the wider U.S.-Iran conflict. Although Portugal generates a large share of its electricity from renewable sources, gas-fired power plants can still influence wholesale electricity prices across the Iberian electricity market.

ERSE said average spot electricity prices on the Iberian market had reached about €147.64 per megawatt-hour during September, more than double the average recorded in September 2025.

The latest increase comes after regulated electricity tariffs were already raised by 1% at the beginning of 2026. The regulator had initially expected those rates to remain in place throughout the year, but developments in international energy markets changed the outlook.

The impact could extend beyond customers directly covered by regulated tariffs. Although the affected households and small businesses account for only about 4.6% of Portugal’s total electricity consumption, ERSE’s regulated rates can influence pricing decisions in the broader liberalised electricity market.

The energy-cost pressure is emerging alongside wider concerns about household expenses in Portugal. The government is considering tax reductions and additional support for pensioners as inflation and elevated fuel prices continue to affect living costs.

Portugal’s latest energy-price decision highlights the continuing exposure of European economies to international fuel markets, even as renewable energy plays an increasingly important role in electricity generation.