Energy Policy

Program of the XXIII Constitutional Government

Energy Transition

Portugal is committed to achieving carbon neutrality by 2050, as a contribution to the global and European goals assumed in the implementation of the Paris Agreement. Accomplishing this goal implies reducing greenhouse gas emissions by more than 85%, compared to 2005, and ensuring a carbon sequestration capacity of around 13 million tonnes.

The energy transition that is foreseen for the next decade will require more than 25,000 million euros of investment, which involves a complex concertation of wills and an alignment of policies, incentives, and means of financing. In order to facilitate this transition, a set of legal and planning instruments must be mobilized to achieve an effective reduction of emissions, while promoting investment, employment and innovation.

Decarbonization is also a strategy for investment and employment creation. Leading the energy transition implies an unequivocal commitment investing in renewable production which should more than double its installed capacity in the next decade, reaching a level above 80% of renewables in electricity production. By 2030, Portugal should achieve a target of 47% renewable energy in gross final energy consumption and a target of 20% renewable energy in transport.

The next decade is the one in which we must make the greatest effort to reduce greenhouse gas emissions, which implies taking on ambitious decarbonization targets, incorporating renewable energy and energy efficiency. Ensuring a fair and inclusive transition is a necessary condition for the success of this vision.

Therefore, aiming at accelerating the decarbonization of the economy, the Government commits itself to:

• Accelerate the implementation of the 2030 National Energy and Climate Plans and the 2050 Carbon Neutrality Roadmap, promoting regional roadmaps for carbon neutrality, developing five-year carbon budgets that define a multi-year horizon, defining methodologies for assessing the legislative impact on climate action, and removing administrative constraints that create disproportionate context costs without environmental added value;
• Implement the Recovery and Resilience Plan (RRP)’s planned €610 million investment in energy efficiency, €300 million allocated for energy efficiency in residential buildings, with special attention to lower income households, and €310 million allocated for energy efficiency in the private sector and Public Administration service buildings, in accordance with the Program for Resource Efficiency in Public Administration (ECO.AP);
• Implement the RRP's planned €715 million investment in the decarbonization of industry;
• Implement the RRP's planned €185 million investment in hydrogen and renewable gases, including the creation of a network of hydrogen supply stations;
• Launch the hydrogen auctions already presented, mobilizing up to €50 million per year from existing CO2 revenues to support the decarbonization of the industry and the heavy passenger and goods transport sector;
• Increase solar energy production capacity by at least 2 gigawatts over the next two years, continuing auctions for new power plants and promoting and facilitating self-consumption and the creation of energy communities;
• Reinforce the electricity production capacity of existing wind farms and promote hybrid systems, reducing the need to build new infrastructure;
• Invest in offshore renewable production, consolidating and expanding the industrial cluster associated with the wind sector;
• Continue to promote a decarbonization-friendly ecosystem, with emphasis on planning and permitting processes;
• Foster the digitalization of the energy system and the development of smart electricity grids, creating better conditions for a significant increase in the electrification of consumption in the different sectors of activity;
• Foster electricity storage generated from renewable sources;
• Achieve the planned interconnections;
• Promote the production of advanced and synthetic biofuels, including green ammonia and methanol, contributing to the decarbonisation of the national chemical and petrochemical and to the decarbonization of the transport sector, namely in air and maritime transport air and maritime transport;
• Assume that decarbonization can and should be a strategy for competitiveness and industrial valorisation, stimulating the incorporation of low-carbon processes, products and technologies, investing in the dynamization of innovation hubs and the creation of new business models, promoting the development of regional industrial clusters and encouraging the widespread adoption of renewable energy sources in industry;
• Present a National Strategy for Biomethane, produced from biomass, wastewater or WWTP sludge;
• Adopt a green tax in accordance with the fair transition goal with a progressive tax burden shift from labour to pollution and intensive use of resources, pursuing the elimination of environmentally harmful tax exemptions and benefits, and providing a clear tax advantage for electric and hydrogen vehicles, changing the tax framework of employers by encouraging public transport over individual transport and establishing incentives for energy efficiency, particularly in residential buildings;
• Implement the Long-Term Strategy for Building Renovation, approved in 2021, which includes a roadmap with indicative measures and targets for 2030, 2040, and 2050, and the National Long-Term Strategy for Combating Energy Poverty 2021-2050, which aims to address energy poverty, protect vulnerable consumers, and actively integrate them into the energy and climate transition;
• Promote sustainable financing by developing a strategy that defines the most appropriate instruments to be mobilized in accordance with the European Green Deal, defining minimum decarbonization criteria as a condition for granting public funding and defining a fiscal and financial framework that induces green investment;
• Promote the issuance of green bonds, encouraging the development of micro-credit platforms oriented towards investment in low-carbon solutions, promoting the articulation between the Fund for Innovation, Technology and Circular Economy and the Environmental Fund in supporting decarbonization projects and increasing efficiency in the use of resources.

Consult Program of the XXIII Constitutional Government