Energy renovation subsidies in Spain: the 2026 grant programmes, tax relief and how to claim

A guide to the grants, tax deductions and reduced VAT that fund energy renovation work on a Spanish home in 2026.

Spanish property owners who upgrade insulation, windows, heating systems or install solar panels in 2026 can draw on three layers of public support: direct grants from the Next Generation EU-funded Plan Eco Vivienda (Real Decreto 853/2021), personal income tax deductions of 20, 40 or 60 per cent under Ley 10/2022 (extended to 31 December 2026 by Real Decreto-ley 16/2025), and a reduced 10 per cent IVA rate on renovation work under Ley 37/1992. The programmes are stacked but not all on the same base: the grant reduces the spend you can deduct against IRPF, while the IVA rate applies to the full invoice. This guide sets out what each layer covers, who qualifies and how the claim works.

What energy renovation subsidies are available in Spain in 2026?

Spain funds residential energy renovation through three distinct mechanisms that can be combined on a single project, though not all on the same euros. A direct grant from the Plan Eco Vivienda, regulated by Real Decreto 853/2021 under the PRTR Component 2, channels European Next Generation EU money through each autonomous community’s housing department. In parallel, three IRPF deductions set out in Ley 10/2022 let an owner deduct 20, 40 or 60 per cent of qualifying spend against their personal income tax. A reduced 10 per cent IVA rate, established in Article 91.Uno.2.10 of Ley 37/1992, lowers the VAT charged on the contractor’s invoice for renovation and repair work on residential property. The Ministerio de Vivienda y Agenda Urbana confirmed in December 2024 that the IRPF deductions, originally due to expire at the end of 2024, were extended for two further years to 31 December 2026 for individual dwellings and to 31 December 2027 for whole-building rehabilitation.

How do the three IRPF energy renovation deductions work?

The Agencia Tributaria administers three personal income tax deductions, each tied to a different energy performance threshold. They are mutually exclusive for the same work, so an owner picks the one that fits the improvement achieved.

Deduction	Requirement	Base cap (annual)	Carry-forward cap	Spend deadline (AEAT)
20 per cent	Reduce heating and cooling demand by at least 7 per cent	EUR 5,000	EUR 15,000 over 4 years	31 Dec 2025
40 per cent	Reduce non-renewable primary energy consumption by at least 30 per cent, or reach energy label A or B	EUR 7,500	EUR 15,000 over 4 years	31 Dec 2025
60 per cent	Whole-building rehabilitation that improves the energy certificate (building-level, not single dwelling)	EUR 5,000	EUR 15,000 over 4 years	31 Dec 2027

The deductions apply to the taxpayer’s habitual residence or to another property they own that is let (or will be let before 31 December 2027) as a habitual residence, per the Agencia Tributaria guidance. The qualifying spend runs from 6 October 2021, the entry into force of Real Decreto-ley 19/2021. The AEAT guidance pages state the spend deadline for the 20 per cent and 40 per cent deductions as 31 December 2025; Real Decreto-ley 16/2025 (BOE-A-2025-26458) subsequently extended this to 31 December 2026 for individual dwellings and 31 December 2027 for whole-building rehabilitation, as confirmed by the Ministerio de Vivienda y Agenda Urbana. The deduction is applied in the tax year the post-work energy certificate is issued, not the year the invoice is paid, and the certificate must be registered under Real Decreto 390/2021.

A practical example: an owner spends EUR 12,000 on insulation and a heat pump that cuts heating and cooling demand by 15 per cent. They claim the 20 per cent deduction. The annual base cap is EUR 5,000, so they deduct EUR 1,000 (20 per cent of EUR 5,000) in the year the certificate is issued, and carry the remaining EUR 7,000 forward, deducting EUR 1,000 a year for the next four years up to the EUR 15,000 cumulative cap. Over five years they recover EUR 2,400 against their IRPF bill.

What grants does the Plan Eco Vivienda offer in Andalusia?

The Junta de Andalucia administers the Plan Eco Vivienda through its Consejeria de Fomento, Articulacion del Territorio y Vivienda, drawing on the framework of Real Decreto 853/2021. Two lines matter most to a Costa del Sol owner.

Linea 4 funds energy efficiency improvements in individual dwellings, whether single-family houses or apartments in a shared building. The subvencionable works are those that cut non-renewable primary energy consumption by at least 30 per cent, reduce heating and cooling demand by at least 7 per cent, or replace thermal envelope elements to meet Código Técnico de la Edificación transmitancia and permeabilidad values. The grant covers 40 per cent of the project cost, with a cap of EUR 3,000 per dwelling and a minimum project cost of EUR 1,000. Professional fees and administrative processing are subvencionable; licences, taxes and tributes (except IVA) are not.

Linea 3 funds whole-building rehabilitation in residential blocks. The grant scales with the energy saving achieved: a 30 to 45 per cent cut in non-renewable primary energy consumption earns 40 per cent funding up to EUR 6,300 per dwelling; a 45 to 60 per cent cut earns 65 per cent up to EUR 11,600; and a cut of 60 per cent or more earns 80 per cent up to EUR 18,800 per dwelling. An additional EUR 1,000 per dwelling (or EUR 12,000 per building, whichever is greater) is available for asbestos removal. The building must be at least 50 per cent residential use by floor area, and the community of owners must approve the works.

Both lines are managed by the autonomous community, which issues convocatorias (call rounds) through the Ventanilla Electronica. Application deadlines and fund availability vary by round, so checking the current convocatoria status on the Junta de Andalucia site is the practical first step. More than 122,800 dwellings used the IRPF deductions between 2021 and 2023, per the Ministerio de Vivienda y Agenda Urbana, reflecting rising uptake as owners combine the grants with the tax relief.

Can the grant and the tax deduction be combined on the same project?

Yes, but the grant reduces the base on which the IRPF deduction is calculated. The Agencia Tributaria treats the PRTR grant as a subsidy that lowers the owner’s net expenditure, so the deduction applies only to the portion of the bill the owner paid from their own funds. If a EUR 10,000 insulation project receives a EUR 3,000 Linea 4 grant, the IRPF deduction base is EUR 7,000, not EUR 10,000. The reduced 10 per cent IVA rate, by contrast, applies to the full invoice value because it is a VAT rule, not an income tax rule, and the contractor charges 10 per cent on the total regardless of whether a grant is involved.

The stacking order, from the owner’s perspective, is: PRTR grant first (cuts the outlay), then 10 per cent IVA on the invoice (lowers the VAT burden from 21 to 10 per cent), then IRPF deduction on the net spend (recovers a further 20, 40 or 60 per cent against tax). A non-resident owner who lets the property under the IRNR cannot use the IRPF deductions because they do not file IRPF, but they can still apply for the PRTR grants and benefit from the reduced IVA rate, which are not tied to personal tax residency.

What renewable energy grants does the IDAE offer?

The Instituto para la Diversificacion y Ahorro de la Energia runs a separate programme under Real Decreto 477/2021 for renewable installations in the residential sector, also PRTR-funded. Programa 4 covers self-consumption solar photovoltaic installations for homes, public bodies and the third sector, with or without battery storage. Programa 6 covers renewable thermal systems: aerotermia (air-source heat pumps) at up to EUR 500 per kW (EUR 3,000 per dwelling), solar thermal at EUR 450 to EUR 900 per kW (EUR 550 to EUR 1,800 per dwelling), biomass at EUR 250 per kW (EUR 2,500 to EUR 3,000 per dwelling), and geothermal or hydrothermal at EUR 1,600 to EUR 2,250 per kW (EUR 9,000 to EUR 13,500 per dwelling). The budget across all six programmes was EUR 1.997 billion through 31 December 2023, per the IDAE tracking portal.

Applications go through the autonomous community’s energy agency. In Andalusia, the Agencia Andaluza de la Energia handles the process. The IDAE also operates the Fondo Nacional de Eficiencia Energetica, established by Ley 18/2014, which funds broader energy efficiency measures through annual action plans, including the 2026 plan published on the IDAE site.

How does the reduced 10 per cent IVA rate work?

Article 91.Uno.2.10 of Ley 37/1992 applies a reduced 10 per cent IVA rate (down from the general 21 per cent) to renovation and repair work on residential buildings. The Agencia Tributaria guidance sets two conditions: the work must qualify as an ejecucion de obra de renovacion o reparacion (covering masonry, plumbing, electrical, painting, carpentry and similar trades), and the materials supplied by the contractor must not exceed 40 per cent of the total invoice cost. If the materials portion crosses the 40 per cent threshold, the operation is reclassified as a delivery of goods and the full 21 per cent rate applies.

A separate rule gives the 10 per cent rate to installations like boiler replacements when they form part of a global rehabilitation project whose cost exceeds 25 per cent of the building’s acquisition price or market value (excluding land value). Standalone equipment purchases where materials dominate, such as a telecoms installation, fall outside the reduced rate and default to 21 per cent. Pool and sport facility work never qualifies because those are not residential uses.

What is the LPH simple-majority rule for energy renovation?

Ley 10/2022 amended Article 17.2 of the Horizontal Property Law (Ley 49/1960) so that works improving a building’s energy efficiency or installing renewable energy sources for common use can be approved by a simple majority of owners at a community meeting, rather than the three-fifths majority previously required for ordinary works. The same simple-majority rule applies to applications for rehabilitation grants and financing. This lowers the voting threshold a community needs to commission facade insulation, a shared solar array or a central heat pump, which is relevant to anyone owning a flat in an older Costa del Sol block. The Horizontal Property Law guide covers the broader LPH framework, and the community governance and voting guide sets out the quorum and majority rules in detail.

How does a property owner apply for the subsidies?

The application path depends on the programme. For the IRPF deductions, no application is needed: the owner declares the spend in their annual Renta filing (Renta Web), under the “Deducciones generales de la cuota” section, “Deduccion por obras de mejora de la eficiencia energetica de viviendas”, and submits the before and after energy certificates, the catastrophic reference and the demand or consumption figures from Anexo II of the certificates.

For the Plan Eco Vivienda grants, the owner (or their gestor de rehabilitacion) applies through the Junta de Andalucia’s Ventanilla Electronica during an open convocatoria. The Linea 4 process requires the energy certificates, a project or memoria justificativa, cost estimates and proof of ownership or tenant authorisation. The community of owners applies for Linea 3 with an approved agreement, a project including a waste management study, and the libro del edificio existente.

For the IDAE renewable grants, the application goes through the Agencia Andaluza de la Energia. The refurbishment permits guide covers the licencia de obra side of the process, and the building and renovating a villa cost guide sets out the construction cost context for budgeting the work these subsidies help fund.

What records must an owner keep?

The Agencia Tributaria requires the before and after energy performance certificates, registered under Real Decreto 390/2021, with the catastrophic reference, issue dates and the relevant demand or consumption figures. The prior certificate must be no more than two years old before the work started. Invoices and proof of payment should be retained, and for the PRTR grants, the resolution granting the subsidy and the justification documentation submitted to the autonomous community. The 60 per cent whole-building deduction additionally requires evidence that the work meets the Codigo Tecnico de la Edificacion rehabilitation standard, not merely a renovation.

This guide is general information, not legal or tax advice. Rules change and individual circumstances differ. Verify current requirements with an independent lawyer (abogado) or tax advisor (gestor/asesor fiscal) before acting.