Message from the CEO - March 2021

Here we are in March (the month when we expected to experience some lighter confinement measures), and the Renewable Electricity sector is once again at a unique moment in its history.

If it is true that the news at European and local levels are and have been encouraging, a series of strategies and directives in favor of mitigating the impact of climate change have been approved, there was a stronger investment on renewable technologies. But it is also true that there are still many challenges to overcome.

Currently, renewables are getting stronger and are recommended. I am pleased to mention that, in February, there was an electricity generation in our country of 88.5% renewable. Yet, from time to time and in a very isolated way, some appeals to the utility of coal for the production of electricity still emerge.

Coal has seen a clear and positive decline. The blatant test took place with the much-talked-about closure of the power station in Sines. But the issue is not being addressed with the same emergency in the rest of the world. In spite of the fact that the United States of America finally has good prospects, if we look at the Asian giants, the fight is not so linear: China and India, for example, intend to reach 75,000 MWh of coal power, a gigantic figure that can confuse the most inattentive.

The explanation for this difference is not simple, but there is one. On the one hand, both China and India have high coal reserves in their territories, unlike Portugal. On the other hand, we are talking about economies in strong expansion, but still with a significant poverty rate. For example, China's GDP per capita is about $ 10,200 and India's $ 2,000, while in Portugal it is $ 23,200 (according to the World Bank statistics for 2019). These countries also face socio-economic challenges that are completely different from the European and national reality.

Moreover, in the top 50 of the most polluted cities, 26 cities are in India and 14 in China, due to the high dependence on fossil fuels, namely on coal. So, in addition to CO2 emissions, they are responsible for the emission of gases such as SO2 and NOx, which are the cause of several respiratory diseases.

Portugal, in its turn, in terms of endogenous resources, is rich and consequently competitive in the production of electricity from renewable sources, having the ideal conditions to support a cost-effective energy transition with a decisive contribution to the reduction of production costs of electricity, based on the technologies currently available.

But, as I said initially, we have not yet reached the goal. On March 8, APREN held another of its Renewable Debates. With the moderation of Susana Serôdio (APREN), and the participation of Ana Guerreiro (Generg), Timóteo Monteiro (EDP Renováveis) and Professor António Sá da Costa (APREN) - whose valuable contribution we are thankful for -, it was very clear that there is still a long way to go when it comes to the licensing of renewable projects. Taking into account the goals established at European level and replicated locally, the delay in the licensing process must clearly be solved as soon as possible, otherwise we will fail to fulfill our potential as an exemplar nation when it comes to investing in renewable energies.

The need for simplification in the case of licensing also applies to the use of European funds for economic recovery - the so-called “bazooka”. Recently, I’ve had the opportunity to talk about the subject in an Expresso / Deloitte debate, where I have made my position on the subject clear, warning about the need to simplify all the processes: from the application for the allocation of funds, to the necessary opinions for the execution of the investment projects. If these issues are not kept in mind, there is a risk of losing this great opportunity for the sector.

Finally, I address the Recovery and Resilience Plan, a document on which APREN had the opportunity to comment through the public consultation open for this purpose for two weeks. APREN considers that, despite the effort to cover important areas such as energy efficiency and the bioeconomy, the document neglects themes that constitute barriers to decarbonisation today. Some areas were not given the relevance that would be expected, such as hydrogen renewable energy, increased capillarity and capacity of the RESP, increased capacity for supplying and charging electric and hydrogen vehicles, mechanisms to support the gain in economies of scale, massification of offshore wind, support for the circular economy for the renewable sector, increasing the capacity of institutions involved in licensing processes, amongst others.

In this sense, we commented that the PRR should include investments in areas such as: network infrastructures, allowing the transition of the energy system in order to capacitate and expand the current public service electric network in line with the objectives of capacity of PNEC 2030, establish and re-adapt infrastructures for hydrogen, smart electrical networks and networks for offshore and energy storage; reforms to integrated territory planning to identify sites for the exploitation of renewable energy and heat waste sites; guarantee environmental sustainability in coordination with measures for the forest, in order to guarantee a sustainable use of the demand and use of bioenergy; removing administrative barriers and ensuring qualifications.

To increase renewable electricity and renewable hydrogen, it is necessary to ensure that administrative entities are strengthened in terms of IT resources and means to match the challenges, mainly in the areas of licensing, planning, monitoring and control.

APREN would like to point out that, although the renewable energy sector was not one of the sectors most affected by the pandemic COVID-19, it saw many of its developments and projects postponed with damaging repercussions on the stability of companies. On the other hand, currently existing barriers have been severely worsened, and it is imperative to start working on a more holistic and integrated view of the entire electricity generation sector.

Much has been done already on this path towards the decarbonisation of the economy, but we still need to move on to practice.

Portugal needs our energy!