Portugal to become a net exporter by 2017

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11 July 2014, Electricity

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With the EU 20-20-20 deadline to reduce carbon emissions looming, European governments are increasingly having to shift away from coal-fired generation. For Portugal, the alternatives lie in natural gas and hydropower. Existing natural gas-fired plants have been upgraded, while the new Sines I and II (444MW each) and Lavos I and II (439MW each) gas plants are expected to be online by 2023. A further 10 hydropower plants are projected to come online in the next eight years, with the Venda Nova III (756MW) and the Carvao-Riberia (616MW) plants being the two largest.

According to Datamonitor Energy's upcoming Power Generation Analyzer for Portugal, by 2030 natural gas will account for 32.5% of total power production in the country compared to the current level of 14.4%. Meanwhile hydropower's contribution is expected to rise by more than 65% from today's level, to reach 28.5%. Coal power generation will continue to decline over the forecast period, falling to 1.8TWh in 2030 from 10.9TWh in 2013.

Yet it's not all good news for Portuguese power generation. Neither geothermal nor photovoltaic electricity generation is anticipated to reach previous expectations, with a weak economy and low investor confidence being the prime inhibitors. Nonetheless, the potential of renewable energy - which is predicted to increase from 15.9TWh in 2015 to 27.2TWh by 2030 - should not be discounted.

Energy consumption in Portugal is projected to drop slightly this year compared to 2013, falling from 47TWh to 46TWH. This is largely due to the Mediterranean country's weak economy, high unemployment levels, and lackluster government spending. However, barring any further financial or economic crises energy demand will increase from 2014, with power consumption projected to surpass 50TWh by 2020 and 70TWh by 2030.

The potential that Portugal has to not only meet but exceed its rising energy demand over the next few years is a positive example to other energy markets. Adopting the relatively straightforward strategy of upgrading existing natural gas facilities and focusing on a feasible and effective renewable energy source, Portugal has shown that simple can be effective.

www.datamonitorenergy.com / asken@datamonitor.com / @DatamonitorEN



Source: MarketLine

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