The Portuguese government wants to make its mark on the sector with a new regulatory framework for the National Electricity System (SNE), which is in public consultation from November 10 until November 24. Here is a list of the main points of the draft regulations to be submitted to the Portuguese Parliament by the end of November.

Due diligence of NES activities and network planning

The differentiation between ordinary regime generation (ORG) and special regime generation (SRG) and the different authorization procedures for electricity generation activity will be abolished.

Production, self-consumption and storage activities will be covered by a single prior control regime which may take the form of prior notification, prior registration and an operating certificate or authorization to production and operation.

The draft decree-law makes new investments in network infrastructure subject to a cost-benefit analysis compared to other alternatives, such as storage.

Bidding mechanisms for the exercise of NES activities

The allocation of licenses (i) Supplier of Last Resort, (ii) Aggregator of Last Resort, (iii) issuer of guarantees of origin and (iv) Logistics Operator for Change of Suppliers and Aggregators will be subject to a procedure of prior public call for tenders.

The draft decree-law creates a new market agent: the integrated operator of the high voltage, medium voltage and low voltage distribution networks, who will carry out the activity within the framework of a concession regime, awarded after a procedure of prior public call for tenders.

Electricity production and storage activities will be remunerated exclusively at the market price or via bilateral contracts, abolishing once and for all the guaranteed remuneration scheme. This notwithstanding the possibility of granting, by public call for tenders, specific support schemes for production from renewable energies.

Active consumer participation in power generation and markets

Passive consumers must become active agents producing electricity for self-consumption or for the sale of surpluses and storage with:

• Installing smart grid infrastructure, which includes energy data communication and processing systems and technologies and smart meters;




• Participation of consumers in electricity markets through the creation of the aggregator;




• New patterns of collective self-consumption and energy sharing through the establishment of energy communities.

The duties of suppliers have been strengthened since they must offer electricity contracts at dynamic prices when they have more than 200,000 customers, provided that the respective consumption facilities have a smart meter.

If the customer has a smart meter, the supplier is now also required to include in the bill a breakdown of the average energy consumption per day of the week and per hour of the day.

If the consumer has a smart meter, he has the right, on request, to access the actual electricity consumption and the actual duration of use, and this data must be easily accessible and free of charge. The consumer is also entitled to additional information relating to the history of consumption and to detailed data on the periods of use.

The draft decree-law also provides a regime for the illegal appropriation of energy.

New realities: retrofitting, hybrids or hybridization and storage

Three Free Technology Zones (ZLT) are planned to facilitate development in new realities:

• The first intended for pilot research and development projects in the context of offshore electricity production, from renewable energies from an ocean source or location;




• The second to be developed as part of the process of dismantling the Pego coal-fired thermoelectric plant; and




• The last, located in Perímetro de Rega do Mira, intended for the implementation of innovation and development projects within the framework of the compatibility of land use for agricultural activities and electricity production.

The project also provides that the re-equipment of a solar or wind power plant will not be subject to the environmental impact assessment procedure. In addition, during the total re-equipment of the production station, the connection power is increased up to a maximum of 20% of the connection power initially allocated, subject to a simple procedure of prior control of simple modification of the production authorization or simple prior notification.

The first challenge to the market has been launched: respond within 15 days to such a vast project to change the legal framework of the Portuguese electricity system.

The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.