Message from the President - April 2022

APREN continues to work every day to show the positive impact of renewables at all levels and to keep them in a central place in the political, economic and, consequently, media.

 

Bearing this in mind, at the end of last March, APREN reported the results of another study that proves the clear benefits of renewables in the formation of the price of electricity: the Deloitte’s study on the “Impact of renewable electricity on consumer-supported price in 2021”.

 

The study was presented to our Members and main stakeholders of the sector, but also the media, which allowed a very interesting coverage of this subject. The study proves that renewables generated annual savings in the electricity bill of up to 300 euros for a domestic consumer and up to 30,000 euros for a non-domestic consumer in 2021, on average.

 

The same study shows how Production under Special Regime (PRE) allowed an average electricity sales price of €88/MWh. The PRE, between 2016 and 2021, allowed accumulated savings of EUR 10.2 billion, of which around EUR 4.1 billion corresponds to 2021 alone, and contributed EUR 2.6 billion to the electricity system in 2021 (the highest number in ten years).

 

Despite the high renewable incorporation, the study also shows that the average annual price of electricity on the wholesale market rose 230% compared to 2020, as a result of the trend of growth in the price of CO₂ emissions allowances and the rise in the price of natural gas, which reached values six times higher than in 2020.

 

The analysis concerns 2021, when the geopolitical situation was not as we know it today, with an overwhelming war that impacts Europe in several quarters. In addition to their economic impact and power to mitigate the impact of climate change, the 2022 figures will show even more blatantly the power that renewables have as a factor in maintaining the sovereignty of countries, increasingly enabling Europe's energy independence from Russia.

 

Already in April, we also saw the government's auction for solar plants in dam reservoirs, an innovation in the installation of renewable power. The auction comprehended seven lots for the installation of 263 MW of floating solar capacity, in the first auction of its kind in Portugal.

 

The prices achieved in this auction were also the result of an Innovation. If in previous grid capacity auctions held in 2019 and 2020, the low prices obtained had already been surprising, but in this last auction the low prices achieved were news across Europe.

 

Over 15 years, the Government estimates the overall benefit for electricity consumers at EUR 114 million, which will represent an average annual value of EUR 7.6 million, in an electricity system with annual charges of around EUR 5 to 6 billion.

 

Given the current situation of high energy prices, the Government advanced on April 11, with a few more measures to contain the increase in energy and food prices approved at the last Council of Ministers, which are under evaluation by the European Commission.

 

One of the points, in our view, is to speed up the installation of renewable power. The Government wants to simplify the licensing process for photovoltaic systems. It is proposed to "adapt the Environmental Impact Assessment scheme" to address the need to speed up the licensing process of renewable power plants and also green hydrogen production projects by water electrolysis, as this process is free of flame hazards and does not cause GHG emissions.

 

In order to shorten the process of analysing and deciding environmental impact assessment procedures, the Government wants to include in them the necessary opinions and authorisations of administrative entities.

 

On the other hand, the issue of an operating allowance or operating certificate will no longer be required for power plants of renewable energy sources, storage facilities and production units for self-consumption, where the grid operator confirms the existence of conditions for the connection to the Public Service Electricity Network.

 

The measures taken at European level and now preparing to be adapted at local level, prove once again the growing centrality of the renewable sector and its importance for the development of the continent – and for its energy freedom.

 

Because Portugal needs our Energy!