Portugal Rocks Renewables: 45% Renewable Electricity by Year's End

For the past 5 years Portugal has been pushing a dramatic shift to renewable energy.  Compared to the standard “20% renewables by 2020” targets that are often brought out at press conferences, its accomplishments are impressive: By the end of the year nearly 45% of its electricity will come from renewable sources. That's up from 17% five years ago.

Elizabeth Rosenthal has written an excellent front page feature in this morning's New York Times on how they managed it.

If you think of it as a recipe, there are three key ingredients of Portugal's success:

  • 1 part opening up of the energy sector to market forces (including the privatization of energy utilities)
  • 1 part technological modernization (in particular the creation of a smart-grid able to handle diverse sources of renewable energy), and
  • 2 parts savvy country-wide energy policy (including guaranteed rates for renewables, and the EU Carbon Trading System).
But like any recipe you also need a chef, in this case Prime Minister José Sócrates who came in on a landslide victory in 2005 and pushed through energy reform.
The current system is a mixture of wind, solar, hydro, small scale decentralized renewables on people's homes (see my last post), and some power still coming from natural gas generators. The Times gives a nice snapshot of the type of “plate-spinning” necessary to keep this kind of system running.  (Not mind you, that a traditional energy grid is simple to run either.)

The financial costs seem to have been relatively minor. The state has not used taxes or debt to fund this transition. The costs are born by the private power producers and come out in the rates paid by consumers. Over the past 5 years, electricity costs have gone up 15%.That's not insignificant, but utilities are asking for similar increases here in North America, without providing any where near the kind of innovation taking place in Portugal.  All the same, voters have been unhappy about rate increases and it seems that this is at least partially responsible for Sócrates narrow victory in 2009.

I've posted short excerpts below, but the full piece is well worth reading.
---

“You cannot imagine the pressure we suffered that first year,” said Manuel Pinho, Portugal’s minister of economy and innovation from 2005 until last year, who largely masterminded the transition, adding, “Politicians must take tough decisions.”

Still, aggressive national policies to accelerate renewable energy use are succeeding in Portugal and some other countries, according to a recent report by IHS Emerging Energy Research of Cambridge, Mass., a leading energy consulting firm. By 2025, the report projected, Ireland, Denmark and Britain will also get 40 percent or more of their electricity from renewable sources; if power from large-scale hydroelectric dams, an older type of renewable energy, is included, countries like Canada and Brazil join the list.

If the United States is to catch up to countries like Portugal, energy experts say, it must overcome obstacles like a fragmented, outdated energy grid poorly suited to renewable energy; a historic reliance on plentiful and cheap supplies of fossil fuels, especially coal; powerful oil and coal industries that often oppose incentives for renewable development; and energy policy that is heavily influenced by individual states.
The relative costs of an energy transition would inevitably be higher in the United States than in Portugal. But as the expense of renewable power drops, an increasing number of countries see such a shift as worthwhile, said Alex Klein, research director, clean and renewable power generation, at IHS.

“The cost gap will close in the next decade, but what you get right away is an energy supply that is domestically controlled and safer,” Mr. Klein said.

Comments

3 Responses to "Portugal Rocks Renewables: 45% Renewable Electricity by Year's End"

Solar Taylen said... 10 August 2010 at 17:03

Dear USA,

Time to start cooking or we're all gonna fry. Here is an excellent recipe.

Love,

Mother Earth

Alex Aylett said... 13 August 2010 at 21:54

Portugal is especially interesting because the path they have followed has been widely advocated for years. Even relatively mass-market books like Thomas Friedman's 2008 *Hot, Flat, and Crowded" have laid out this regulated market driven approach.

So in a sense what Portugal has done isn't news. But it sure is too bad more people haven't gone in the same direction.

Blogger said... 26 January 2017 at 23:09

You might be qualified for a new solar rebate program.
Click here and find out if you qualify now!

About




This is a blog for news and views on the future of sustainable cites. A major revamp is in the works. Until then I am keeping this version up as an archive of my past writing.

You can expect occasional updates, but not with the same frequency as in the past.

You can also find my writing on urban redesign and sustainability in ReNew Canada, The Mark, Sustainable Cities Canada, WorldChanging, and other more specialized academic publications.

Info on my consulting work, c.v. and current research focus is all here.