The year 2023 brought important regulatory and legislative developments that reinforce the commitment, both at European and national level, to take a leading role in the energy transition and carbon neutrality. At European level, the various initiatives under the REPowerEU legislative package stand out, the objectives of which are to reduce dependence on polluting technologies for electricity production with a view to a resilient and fully sustainable energy system. The launch of the public consultation on the Net-Zero Industry Act (NZIA) and the publication of the third version of the Renewables Directive (RED III) are emblematic examples of these initiatives. At national level, the submission of the revision of the National Energy and Climate Plan 2030 to the European Commission stands out, with a transversal increase in ambition compared to the original edition and the publication of Decree-Law 11/2023, which simplifies environmental licensing processes, originally announced in 2022.

This year’s edition, as in previous years, explores the main data and indicators for generation and production in the renewable electricity sector, including environmental and macroeconomic analyses, as well as pointing out the most important news and legislative changes, including the portfolio of all our Members’ renewable electricity production centres. We also present the relevance of the Members whose projects are still in the development phase, including a section dedicated to the power to be installed by technology.

In 2023, APREN had a total of 201 Members, divided into the categories of Producers (74 Members) and Services and industry (125 Members). In terms of national representation, APREN represents 86% of the renewable electricity production sector in Portugal, which translates into a share of 99% of installed wind power, 89% of small hydro, 87% of large hydro, 60% of solar photovoltaic, 45% of biomass and 100% of geothermal.

The 2024 Yearbook shows 11 biomass power stations (387 MW), 244 wind power stations (5.773 MW), 46 large hydro power stations (6.737 MW), 94 small hydro power stations (369 MW), 95 solar photovoltaic power stations (1 188 MW) and 3 geothermal power stations (33 MW). These figures correspond to a total of 493 renewable power stations with a capacity of 14,487 MW.

Following the standardisation defined by Directive (EU) 2018/2001 on the promotion of the use of energy from renewable sources, final national electricity consumption from renewable energy represented 62.0%¹ of the total. Bearing this in mind, there was an average year for wind power production, which recorded a wind index of 0.99. However, unlike the previous year, hydroelectric production picked up relatively strongly given the continuing state of severe drought in Portugal, with a hydro index of 0.99. The solar index was 1.01 in 2023.

The figures for electricity production from renewable sources show a contribution of: 11.9 TWh from hydro plus 2.8 TWh from pumping, 13.1 TWh from wind, 2.9 TWh from bioenergy, 0.18 TWh from geothermal and 3.6 TWh from photovoltaics, to which can be added 1.7 TWh generated from self-consumption. Regarding fossil fuel electricity generation plants, the worst performers were natural gas with 8.1 TWh, fossil cogeneration plants which contributed 2.1 TWh and fuel and diesel plants with 1.1 TWh.

Especially in 2023, there was a 47.4% reduction in the average electricity price in the Iberian wholesale market, consolidating and emphasizing that the renewable electricity sector has had and will continue to have a fundamental role as a safety net for consumers against a potential abrupt increase in electricity prices. This is because the production of electricity with a guaranteed tariff continued to provide an economic benefit to the system, generating an extra gain for the National Electricity System (SEN) and, consequently, savings for consumers. All these factors highlight the importance of renewable electricity for society, the economy, and the environment, with the following facts being noteworthy:

• A savings in natural gas imports of €1,950 million, a reduction of 61.4% compared to the value verified in the previous year;
• 9.7 Mt of CO₂ equivalent emissions avoided;
• Avoided €750 million in CO₂ emission permits;
• €626 million saved on imported electricity;
• An accumulated savings of €7,014 million induced by the Merit Order Effect of renewables.

Analysing the aforementioned data, specifically the savings on natural gas imports, should always take into account the fact that 2022 was marked by the war in Ukraine and the increase in the price of natural gas due to sanctions by the European Union, which had very clear and visible repercussions on the electricity sector.

There was a slight increase in electricity consumption of 0.3 per cent (50,382 GWh in 2022 to 50,523 GWh in 2023), which seems to be associated with an increase in the electrification of energy consumption. There was an increase in renewable incorporation in terms of electricity production, emphasised by the resumption of the positive contribution of hydroelectric technology, given the increase in rainfall in Portugal throughout 2023.

Going into more detail on the important legislative developments at European level, 2023 was marked by two important pieces of legislation: the Net-Zero Industry Act and the most recent revision of the Renewable Energy Directive (RED III); the former, published in March 2023, is part of the industrial pillar of the Green Deal, aimed at creating a predictable and simple regulatory ecosystem, boosting the production capacity of goods and services that are key to meeting Europe’s carbon neutrality objectives. Accelerating the development and implementation of net-zero technologies aims to reduce the risk associated with replacing Russian fossil fuels with other strategic dependencies that could jeopardise socio-economic development within the European Union. On the other hand, the most recent revision of the Renewable Energy Directive (RED III) confirms the reinforcement of the ambition formalised by the European Union to make Europe a climate-neutral zone by 2050. The renewed binding targets contained in the piece of legislation published in April 2023 are as follows: 42.5 per cent renewable incorporation in final energy consumption by 2030, with an additional indicative supplement of 2.5 per cent that will make it possible to reach the 45 per cent to which all member states must contribute. In order to follow a positive path towards meeting the proposed targets, the directive incorporates a series of objectives, such as:

• Integration of renewable energy into buildings;
• Identification of areas necessary to meet the 2030 targets;
• Definition of areas for accelerating the implementation of renewable energies;
• Increased public participation;
• Definition of areas for network and storage infrastructure;
• Simplification of licensing procedures;
• Adequacy of resources of competent authorities;
• Classification of renewable energy projects as projects of superior public interest.

At the national level, the revision of the National Energy and Climate Plan 2030 (PNEC 2030) stands out, which transposes into national legislation the increased ambition expressed and formalized in RED III. Additionally, it is worth mentioning the simplification of environmental licensing processes under the new SIMPLEX measures package, legislatively formalized through the publication of Decree-Law No. 11/2023. This effectively eliminated situations requiring a case-by-case analysis, redefined thresholds subjecting projects to the need for Environmental Impact Assessment (EIA) and eliminated EIA to produce green hydrogen.

In June 2022, the governments of Portugal and Spain created the Iberian mechanism for limiting the price of natural gas for the formation of the price of electricity produced by natural gas combined cycle power stations. The so-called ‘gas cap’ set a limit of €40/MWh on theprice of natural gas for electricity production. Due to the reduction in prices on the wholesale market mentioned above, the mathematical formulation of this mechanism was effectively rendered useless and was not renewed for this year. Nevertheless, it contributed an accumulated saving of 4.78 billion euros, broken down into 4.1 billion euros in 2022 and the remaining 680 million euros in 2023. Looking at the renewable sector’s contributions to the National Electricity System’s surplus, wind power stands out, ensuring a total economic benefit of 1.65 billion euros, broken down into 51.9 million euros in 2022 and 1.59 billion euros in 2023.

All these advancements in national legislation were achieved thanks to the spirit of collaboration and harmony with all entities involved in steering this sector, with special emphasis on: the Ministry of Environment and Climate Action, Ministry of Finance, Ministry of Economy and the Sea, Ministry of Infrastructure and respective State Secretariats, DGEG, APA, REN, E-Redes, SU Universal, ERSE, ENSE, the CCDRs, ICNF, LNEG, DGPC, Regional Health Administrations (ARSs), and Municipal Councils. However, I cannot fail to thank all these stakeholders for the close interaction they have maintained with APREN, stating that the Association’s door will always be open to them to continue the dialogue and open debate towards decarbonization.

I’ll conclude on a personal note. I am proud to have seen the Association continue to grow, both in terms of Members and in terms of the number of employees (to whom I am very grateful for the work they have been doing and without whom the results achieved would not have been feasible) throughout my fifth year in office, having clearly reinforced my conviction of the growing and unavoidable importance of the renewable electricity sector in Portugal and Europe, because: