Renewables in Portugal: back to the future

In the 15th century Prince Henry the Navigator of Portugal, seemingly turned his back on royal life and moved to his castle in Sagres on the ocean to dedicate his time to his life’s ambition: to develop new navigation techniques and to make Portugal a global naval power. Today the country is looking to the future once more. In fact, it is proving to be one of the most ambitious in terms of developing renewable sources and decarbonizing its electricity generation mix. This small country has huge resources for the potential production of clean energy, in particular wind power and photovoltaic (PV), not forgetting the country’s significant hydroelectric production and geothermal resources. Portugal’s latitude means that it is blessed with an abundance of solar energy, while its position on the Atlantic coast exposes it also to strong winds. Moreover, the future holds significant potential for marine energy, in particular the power of its waves, for which Portugal is famous the world over. Giant leaps and ambitious goals Until very recently, Portugal’s energy system was outdated, based only on fossil fuels that the country had to purchase from abroad due to the scarcity of domestic raw materials: reducing the country’s dependency on imports was an extra reason to embrace the energy transition and value indigenous natural resources. Given this situation, the country made a resolute decision to embark on a journey towards a cleaner system, and already the first results are being seen: the percentage of final energy consumption supplied from renewable sources has risen from 19.2% in 2004 to 28.1% in 2017. Then in 2018 the country achieved an exceptional result, with few equals around the world: the electricity produced from renewables in the month of March exceeded the energy consumed in the country during the same period. “Today there is huge interest in investing in renewable energies in Portugal. One of the factors is the abundance of natural resources, especially the sun and wind: other factors are the regulatory stability and a level of country risk that is markedly low. In Portugal it is possible to develop substantial industrial projects under financial conditions that are generally favorable, and this is attracting the attention of numerous international investors” Antonio García Gallego, Head of Business Development Portugal at EGP Today when it comes to the production of wind power Portugal is second only to Denmark among the countries belonging to the International Energy Agency (IEA): it has also now become an exporter of energy. Also from the technological point of view the country is developing examples of national excellence: it is a world leader in terms of the integration of wind and solar plants and is at the cutting edge of experimental projects to extract electrical energy from power of the ocean waves. Portugal’s goals for the future are also extremely ambitious: to achieve 80% of the country’s electricity from renewable sources by 2030, and to completely eliminate greenhouse gas emissions from the generation of electricity by 2050. Enel Green Power is a natural partner These goals appear to almost totally reflect those of our Group. And this congruity just had to lead to a meeting, especially seeing as neighboring Spain is one of the most important countries for Enel and since 1993 Endesa has been active in Portugal, where it is the second largest energy retailer in the liberalized market. A fundamental step in this convergence was the second contest for renewables held by the Portuguese government in the summer of 2020: our Group, through our subsidy Endesa Generación Portugal, was awarded 99 MW of capacity at a solar plant with storage that is to be built in the Algarve in the far south of the country. The solar plant, which will be developed, constructed and managed by Enel Green Power, will enter into operation in 2024 and will be entitled to connection to the national grid based on a 15-year contract with the Portuguese National Electricity System. More importantly, it will be the Group’s first renewable plant integrated with an energy storage system in the Iberian peninsula: a fact of great importance, considering the decisive role that storage is beginning to play in terms of providing flexibility to the electricity grid and, in particular, enabling the full integration of renewable sources.) "This project will be innovative not only because of the business model being applied for the first time in the Iberian peninsular, but also for the technology used. The technology that we will install, in fact, does not yet exist: together with the world’s leading manufacturers, our partners, we have tried to imagine how this future technology will be." Antonio García Gallego, Head of Business Development Portugal at EGP The new project, therefore, is an important step forward, advancing on an already consolidated presence, and our strategy aims to bring many others along in our wake. Just like Prince Henry the Navigator, we too are looking to the future in order to bring prosperity to the country.

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Renewables in Portugal: back to the future

Renewables in Portugal: back to the future

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