overview of the energy policy in portugal edp – energy planning department ana quelhas –...

Overview of the Energy Policy in Portugal

EDP – Energy Planning DepartmentAna Quelhas – [email protected]

Budapest, November 26th 2009

Prima F5 e este botão para Introduzir o nome da Direcção/Departamento no rodapé da apresentação

Energy Planning Department2

Agenda

Overview of the Portuguese energy sector

Energy policy in Portugal

Conclusions

Energy Planning Department

Final energy consumption is decelerating, having recently even decreased (economic slowdown and energy efficiency)

3

Source: DGEG

E v o lu t io n o f fi n a l e n e r g y c o n s u m p t io n ,

b y s e c t o r

M toe

Evolution of final energy consumption, by sectorMtoe

14.1

18.219.5

18.7

‘95-’00 ‘00-’05 ‘05-’07

-0.4% 1.4% -14.1%

10.5% 6.9% -5.3%

2.8% 1.9% -0.4%

7.3% 0.7% -0.7%

4.1% -0.1% -0.6%

5.2% 1.4% -2.0%

C o m p o u n d a n n u a l g r o w t h r a t e

%

Compound annual growth rate%

GDP annual growth

4.1% 0.6% 1.5%


Electricity consumption has maintained growth rates above final energy consumption

4

E v o lu t io n o f e le c t r ic i t y c o n s u m p t io n , b y

s o u r c e

M toe

Evolution of electricity consumption, by sourceMtoe

‘95-’00 ‘00-’05 ‘05-’07

0.3% 49.0% 4.7%

17.1% 21.7% 24.0%

6.6% -16.1% 45.2%

-7.8% 1.2% -49.4%

NA 14.1% -4.0%

1.8% 0.9% -9.7%

5.5% 4.7% 2.0%

C o m p o u n d a n n u a l g r o w t h r a t e

%

Compound annual growth rate%

Source: REN

29.4

38.5

48.650.6

Technologies under the special regime category (mainly renewables) have the fastest growth rates


Weight of the top-2 fuel types on primary energy consumption%, 2007

Weight of the top-2 fuel types on primary energy consumption%, 2007

Share of imports in primary energy consumption%, 2007

Share of imports in primary energy consumption%, 2007

5

68%73%

59%

76%82%

70%72%

PT ES IT FR DE UK HU

Nuclear Oil Coal Gas Renewables

61%

20%

59%50%

82% 80%85%

PT ES IT FR DE UK HU

EU15

63% EU1556%

Portugal is in line with other European countries regarding fuel diversity, but has a higher dependency on imports

Source: Eurostat


Share of imports in consumption%, 2007

Share of imports in consumption%, 2007

6

Weight of the top-2 fuels on consumption%, 2007

Weight of the top-2 fuels on consumption%, 2007

Reserve margin1

#, 2008Reserve margin1

#, 2008

1. Reliably available capacity / (Margin against peak load + Load with or without DSM potential)Source: UCTE (System Adequacy Forecast 2009-2020), Eurostat

Portugal

Avg. hydraulicity64%

Reference level= 1.10

The Portuguese power sector has a better performance in terms of security of supply than the energy sector in general

Portugal


Portuguese energy strategy is focused on improving security of supply through competitiveness and environmental adequacy

Competitividade

7

Portuguese National

Energy Strategy

• Market deregulation

- MIBEL

• Strengthen infrastructures

• Ensure generation capacity

• Integrated competitive players

• Regulator’s independence

Stimulate competitiveness

Guarantee environmental

adequacy

Ensure security of supply

• Renewables strong promotion

- Hydro and wind power- Effort on other sources

• Targets on biofuels

• Key measures on energy efficiency

• Industrial and R&D cluster linked to renewables development

• Enough supply to meet demand

• Fuel diversity

• Energy independency


Agenda



Conclusions


• Reach 45% of renewables in electricity mix in 2010 and 60% in 2020

• Reach 10% in biofuels in 2010 and 10% of renewables in transports in 2020

• Replace 5-10% of coal with biomassa in coal-fired power plants

Promote renewable energies

Increase hydro installed capacity

Increase energy efficiency

Reinforce interconnection capacity

• Increase the explored potential from 46% in 2008 to 67% in 2020• National plan for hydropower developments: 1,100 MW by 2020• Under construction: Baixo Sabor, Ribeiradio and reinforcements

at Picote, Bemposta and Alqueva

• Implement the National Action Plan for Energy Efficiency (PNAEE) with the objective of reducing 9.8% of final energy consumption by 2015

• Increase interconnection capacity with Spain, with the objective of reaching 3,000 MW in 2014

Portugal has adopted a comprehensive policy that contribute to security of supply, competitiveness and sustainability

9

Increase CCGT installed capacity

• License 4 new CCGT plants with a total power of 3,200 MW

A

B

C

D

E

Promote the electric vehicle • Promote electric mobility (Mobi.E)F


#4 #5

UE-25 21%

UE-27 20%

Portugal has taken a leadership role in the development of renewable energy sources

R e n e w a b le s t a r g e t f o r 2 0 1 0

% of renew ables in gross e lectric ity consum ption

Renewables target for 2010% of renewables in gross electricity consumption

R e n e w a b le s t a r g e t f o r 2 0 2 0

% of renew ables in the gross final energy consum ption

Renewables target for 2020% of renewables in the gross final energy consumption

10

Source: Directive 2001/77/CE; COM(2008) 19 final 23Jan08

x Ranking of PortugalA


The Portuguese Government has revised its renewable energy policy to more ambitious targets for 2010

Source: Ministério da Economia e da Inovação – Energy Policy (2007)1. MG – Micro-generation; 2. Bring forth European Union goal by 10 years; 3. Fuel tax

• Additional capacity of 450 MW through upgrades in existing facilities• Create industrial clusters associated with two launched bids• Launch bids to grant 200 MW of installed capacity to small promoters

• Support investment in hydropower and pumping capacity reinforcement − anticipate two capacity reinforcements/upgrades projects and duplicate

current Alqueva’s hydro plant capacity until 2010/11

• Create decentralized network of biomass plants (~15 new plants)• Close cooperation with regional forest resources and with fire-risk mitigation

policies

• Build largest photovoltaic plant in the world • Mandatory installation of thermal solar panels

• Create Pilot Area with exploration potential up to 250MW• Promote industrial and pre-commercial technological development with prototype

installation in emerging technologies

• Reinforce bio-fuels goals (5.75% -> 10%)2

• ISP3 exemption for road transportation fuels and domestic agricultural incorporation

• Launch new bid during 1st semester of 2007

• Create residue anaerobic treatment units • Resolution of environmental problems, namely “Ribeira dos Milagres”

• “Instant Renewables” – simplified system for micro photovoltaic and wind power • Program to install 50,000 systems until 2010, with incentive for installation of

Solar Hot Water in existing households

Wind

Solar

Biogas

Micro-generatio

n

Hydro-power

Biomass

Wave

Biofuels

3,750 MW4,700 MW

+ 450 MW

5,000 MW5,575 MW + 7,000 MW

(2020)

150 MW 250 MW

150 MW150 MW invest in

MG1

50 MWPilot area

with 250 MW

No goals10% road

transportation fuels

No goals 100 MW

No goals50,000

roofs

DescriptionDescriptionInitial

targetsInitial

targetsTargets

‘10Targets

‘10A


To promote renewables, Portugal has an incentive scheme based on feed-in tariffs

Source: DL 225/2007; DPE Analysis1. Assuming 3,200 working hours; 2. Assuming 2,100 working hours; 3. Tariff applicable to installations with less than 10MW capacity; 4. Tariff goes from ~250€/MWh in 2008 (demonstration model) to ~75€/MWh in 2016 (commercial model)

Constant in nominal terms (decreasing in real terms)

Inflation

From 10/15 (most technologies) to 20 years (mini-hydro) and 25 years (biomass)

Pool price + guarantee of origin (if already developed)

New projects licensed after February 2006

74 74 75

317

259

114 117

254 253

52

Estimated tariffs for RES-E in PT for 2009 (1st year of operation)€/MWh

Estimated tariffs for RES-E in PT for 2009 (1st year of operation)€/MWh

Mini hydro1

Wind onshore2

Wind offshore

Solar

PV

Solar thermo3

Biomass Biogas Wave4 Tide4 Geo

Yearly indexation

Remuneration value for first

year of operation

Scheme duration

Applicability

Remuneration at the end of

defined scheme

Overview of key legislation aspects DL 225/2007Overview of key legislation aspects DL 225/2007

A


Portugal is on track to meet its renewables objective for 2010, having already surpassed the 45% target

1. The share of reneweables for compliance with the indicative target set for 2010 is calculated assuming the same hydraulicity index of the base year (1997) 2. Moving year from September 2008 to August 2009Source: DGEG – Estatísticas rápidas sobre renováveis

Renewable share (Real)

Renewable share

(Directive1)

S h a r e o f r e n e w a b le s in g r o s s e le c t r ic i t y c o n s u m p t io n in P o r t u g a l

%

Share of renewables in gross electricity consumption in Portugal%

2

13

2

A


Wind power has been the renewable tecnology with the fastest growth rate in recent years

E le c t r ic i t y g e n e r a t io n f r o m r e n e w a b le s

TW h

Electricity generation from renewablesTWh

In s t a l le d w in d p o w e r c a p a c it y

M W

Installed wind power capacityMW

A

2

CAGR03-08 = 119%

1

1. Moving year from September 2008 to August 2009Source: DGEG – Estatísticas rápidas sobre renováveis


For 2020, Portugal will most likely have to reach a share of 60% of renewables in the electricity mix

Source: COM(2008) 19 final 23Jan08; European Energy and Transport – Trends to 2030, update 2007

R e n e w a b le s t a r g e t f o r P o r t u g a l in 2 0 2 0

Share of renew ables in gross final energy consum ption

Renewables target for Portugal in 2020Share of renewables in gross final energy consumption

F o r e c a s t o f fi n a l e n e r g y p r o fi le f o r

P o r t u g a l in 2 0 2 0

%

Forecast of final energy profile for Portugal in 2020%

Share of renew able in each sector

Share of renewable in each sector

Sector ’s share in total energy consum ption

Sector’s share in total energy consumption

15

A


Untapped hydro potential is set to be a key generation capacity growth driver in Portugal for the next 10 years

Hydro potential available

97%

86%

65%

France

86%Italy

Germany

78%Spain

Finland

Greece

PORTUGAL 46%

42%

Hydro potential developed

2015E

60%

16

Source: Ministério da Economia e da Inovação – Energia e Alterações Climáticas (2007)

67%

% Portuguese hydro potential developed

60%54%46%

H y d r o p o w e r in s t a l le d c a p a c it y

M W

Hydropower installed capacityMW

D e v e lo p e d h y d r o p o t e n t ia l in E u r o p e

%

Developed hydro potential in Europe%

B


Hydro contribution is key to achieve Government’s goal of 60% by 2020

Portugal’s progress towards achieving 2020 EU renewable targets implied for the electricity sectorTWh

Portugal’s progress towards achieving 2020 EU renewable targets implied for the electricity sectorTWh

The recently elected Government aims at assuring a leadership position of Portugal in terms of renewables and has already announced the objective of reaching 8,500 MW of wind power

and 1,500 MW of solar by 2020

60%

Demand ‘08 Δdemand ‘08-’20

Demand ‘201 Target ‘20 Hydro Wind Other

Required new RES-E

'09-'20

Gov goals2 '10

New hydro Gap to target 2020

Renewable generation in 2008

1. Low demand scenario assumed for Demand growth; 2. Assumed working hours of 2.200h and 3.000h for wind and other renewables, respectivelySources: Internal information; XVIII Government’s program

A B


Regarding conventional thermal power, the Portuguese Government has licensed ~3,200 MW of new CCGT

18

In s t a l le d C C G T c a p a c it y in P o r t u g a l

M W

Installed CCGT capacity in PortugalMW

C C G T is t h e p r e fe r r e d

c o n v e n t io n a l t e c h n o lo g y

CCGT is the preferred conventional technology

• Higher environmental performance

• Reduced time-to-market

• Higher economic attractiveness

• Lower initial investment

• Lower financial risk against market prices and CO2

EDP was awarded 2 out of the 8 licences (Lares 1 and 2) and has already committed both units

New licenses

C

Lares 1 & 2 were commissioned in

Aug-09 and Sep-09


Direct savings from fuel and CO21

M€

Direct savings from fuel and CO21

M€Directly avoided CO2 emissions2

Mton/ano

Directly avoided CO2 emissions2

Mton/ano

InvestmentsM€InvestmentsM€

Job creationNew direct job creationJob creationNew direct job creation

5.8

2.0

1.91.0

10.7

Wind Hydro CCGT Others Total

3,200

11,520 18,270

2,1501,400


7,700

4,835

1,9201,700

16,155


488

105

85

717

39

wind Hydro CCGT Others Total

11% of 2007 energy bill

70% of the power sector emissions

in 2007

10% of 2007 GDP

40% of jobs created in the past 3 years

Energy dependency of the power sectorEnergy dependency of the power sector

55%

40%

2010 2020

19

The bet on renewables and CCGT is promoting investments, creating jobs and enabling regional development

1. Assuming Brent at 70 $/bbl, coal at 70 $/ton, CO2 at 20 €/ton; 2. Assuming an emission factor of 0.5 ton/MWh

A B C


3.0

1.2

1.9

2.6

3.02.8

1.9

1.0

2008 2010 2012 2014

PT -> ES ES -> PT

2.2

1.8

2.6

1.1

1.8

2008 2010 2012 2014

PT -> ES ES -> PT

Increase interconnection capacity to ~3,000 MW (25% of peak consumption - best practice1)

Source: REN, Plano de Desenvolvimento e Investimentos da RNT 209-2014 (2019 – Consulta Pública (Feb08)1. EU recommends that the interconnection capacity represents 10% of the peak demand of the smallest of the interconnected systems

2nd interconnection in the northwest of Portugal – Galiza, 400 kV (2013/14)

Reinforcement in the Tagus axis, 400 kV (2009/10)

Algarve-Andaluzia, 400 kV (2010/11)

Winter Summer

Reinforcement in the international Douro river, 220 kV and 400 kV (2008/09)

DN e w p r o je c t s p la n n e d u p t o

2 0 1 2

New projects planned up to 2012

In t e r c o n n e c t io n c a p a c it y b e t w e e n

P o r t u g a l a n d S p a in (GW )

Interconnection capacity between Portugal and Spain (GW)

The increased interconnection capacity is essential for market integration and to promote large integration of renewables


Regarding energy efficiency, the Government has launched a program with a savings target of 9.8% by 2015

1. National Action Plan for Energy EfficiencySource: PNAEE

21

P N A E E e s t im a t e d s a v in g s , b y s e c t o r

%

PNAEE estimated savings, by sector%

E n e r g y S e r v ic e s D ir e c t iv e

Directive 2006/32/CE

Energy Services DirectiveDirective 2006/32/CE

• 1% per year saving from start of 2008 to end of 2016

• Final energy saving vs. ‘01-’05 national average

• Member states obliged to submit national plans

- PNAEE1 in Portugal

• Non-binding target

Portuguese objective is 20% above the target set by the European Directive for 2015

E


In 2009, public funds allocated to energy efficiency measures amount to €290M

IIE

Initiative for investment and job creation

PPEC

Plan for promoting efficiency in the

electricity consumption

PNAEE

National Action Plan for Energy Efficiency

Total

Sources: PNAEE, Government website (www.gov.portugal.pt), IIE, ERSE

P u b l ic f u n d s f o r in v e s t m e n t s in e n e r g y e ffi c ie n c y in 2 0 0 9€M, 2009, by supporting mechanism

Public funds for investments in energy efficiency in 2009€M, 2009, by supporting mechanism

22

• Part of a €2,180M economic stimulus package:

- €1,300M directly from the Government’s Budget

- €880M of EU funds

• €250M allocated to Sustainable Energy (mainly to promote micro-generation and energy efficiency measures in the public sector)

E


One of the measures adopted under PNAEE is a simplified system for renewable micro-generation (“Instant Renewables”)

Sources: PNAEE,

23

E

Registration system:• Identifies

electricity client number

• Installed capacity up to 50% of contracted power and 3.68 kW

• Micro-PV, or• Micro-wind, or• Micro-hydro, or• Cogeneration with

biomass, or• Fuel cells

+• Solar thermal

• Inspection occurs up to 4 months after registration

• Registration system grants certification to use the equipments

Contract is signed with the retailer to start selling power to the grid• Up to 75% of the

revenues can go directly to the bank to finance the investment

Online registration

Installation of the equipment

Inspector grants Certification

Starts selling power to the grid


With “Instant Renewables” the Government expects to reach 165 MW of micro-generation by 2015

Sources: PNAEE, DL 363/2007

24

EM a x im u m a l lo w e d in s t a l le d c a p a c it y

M W

Maximum allowed installed capacityMW

E v o lu t io n o f t h e r e f e r e n c e t a r iff

€/M W h, scenario of m axim um installed capacity

Evolution of the reference tariff€/MWh, scenario of maximum installed capacity

Up to 165 MW in 2015

0

100

200

300

400

500

600

700

2008 2009 2010 2011 2012 2013 2014 2015

Solar PV Wind Hydro

~650 €/MWh in 2008

~300 €/MWh in 2015

• Maximum installed capacity increases 20%/year• Tariff valid in the construction year is guaranteed for the first 5 years; after that, the tariff of the

corresponding year applies


The Government is promoting the adoption of the electric vehicle through the Electric Mobility Program (Mobi.E)

Sources: RCM 81/2009, Mobi.E website (www.mobi-e.pt)

25

F

Portugal is in the front run in the development and adoption of new energy models for mobility

An integrated network between several points existing in national territory boosted by the management entity Mobi.E which shall allow the supply of electric vehicles by way of a charging card

What is the Electric Mobility System?

• At private garages • At public access points (car parks,

shopping centres, hotels, airports, petrol pumps and on the public highway)

Where are the supply points located?

• Overnight, taking advantage of the energy produced by renewable sources at times of lower consumption

• By way of rapid charging during the day in accordance with the needs of the user

How can the electric vehicle be supplied?

By way of a pre-paid card CHARG.E of the Mobi.E network which shall provide them with access to the supply points, discounting the charging value

How is supply processed?


In a mature phase, smartgrids and two way charging will allow electric vehicles to sell energy stored in batteries to the grid

Sources: RCM 81/2009, Mobi-E website (www.mobi-e.pt)

26

F

• The pilot phase was launched this year and will test technical, services and business solutions

C h a r g in g p o in t s in t h e p i lo t p h a s e

# of charging points

Charging points in the pilot phase# of charging points

S q u e m a t ic r e p r e s e n t a t io n o f t h e v e h ic le -

t o -g r id ( V 2 G ) c o n c e p t

Squematic representation of the vehicle-to-grid (V2G) concept

• In a mature phase, V2G will allow not only buying electricity to charge the vehicle but also selling the stored energy to the grid (intelligent charging and distributed storage)


Note: Assuming generation mix 35% CCGT, 25% coal and 40% renewables; Base year used: 2006Source: DGEG, DPE analysis

Primary energy consumptionMTep, %

Primary energy consumptionMTep, %

Energy billM€, %Energy billM€, %

CO2 emissionsMton, %

CO2 emissionsMton, %

Energy dependency%

Energy dependency%

Electric consumptionTWhe, %

Electric consumptionTWhe, %

17.6

50.050.0

ICE 100% EV

7.2

2.9

18.718.7

ICE 100% EV

17.47.1

65.865.8

ICE 100% EV

2,573

335

3,3283,328

ICE 100% EV

28% 16%

61%56%

ICE 100% EV

25.9

21.6

-17%

83.2

72.9

Kyoto

targ

e 2

01

2 –

77

,2 M

ton

-12%

5,901

3,663

-38%

+35%

67.6

-8%

84%

77%

Passenger transportation

Others

If all vehicles became electric, the impact would be very significant for the national energy balance

F


Agenda



Conclusions


Conclusions

29

• Portugal has a high dependency on primary energy fossil fuels imports

- 82% vs. 56% of EU15, in 2007

• The power sector has a better performance in terms of security of supply than the energy sector in general

- Higher fuel diversity

- Less dependency on imports

- Adequate reserve margin

• Portuguese energy strategy is focused on improving security of supply, promoting renewables, efficient conventional thermoelectric power, and energy efficiency

- Set targets of 45% and 60% for renewables in the electricity mix in 2010 and 2020, respectively, with a clear focus on hydro and wind

- Awarded licenses for new natural gas generation capacity of 3,200 MW

- Approved legislation and launched programs to improve energy efficiency and promote the adoption of electric vehicles

overview of the energy policy in portugal edp – energy planning department ana quelhas –...

Documents

primary energy consumption

energy efficiency industrial

eurostat slide

general portugal slide

imports source

portuguese power sector

portugal conclusions

eurostat portugal