Portugal’s renewable electricity production (mostly from hydropower and wind energy) exceeded monthly consumption in March. The average renewable generation for the month exceeded 103.6 percent of consumption. According to the nation’s transmission system operator, renewable energy production reached 4,812 gigawatt hours, surpassing the total of Portugal’s electricity needs for March, which totalled 4,647 gigawatt hours. But that does not mean that Portugal’s electric system can rely solely on renewable energy. At least, some say, not until 2040—over 20 years from now—will that be able to happen in a cost effective way.
Portugal is in a somewhat unique situation in that it gets a considerable amount of electricity from hydroelectric power—55 percent last month—due to higher-than-usual rainfall. Wind added 42 percent. But, fossil fuels and imported electricity were also needed because wind and solar power are intermittent energy sources. Portugal’s grid operated on 100 percent renewable energy for only relatively short periods—just two 70 hour spans. Electricity imports and fossil fuel generation were needed to balance the grid when solar and wind power were not available. Portugal also has among the highest electricity prices in Europe, and when adjusted for purchasing power, its electricity is the most expensive in the European Union.
The variability in renewable power can be seen by contrasting this year’s March electricity production to last year’s. During the same period last year, renewable energy supplied just 62 percent of Portugal’s electricity—partly because of a drought that reduced its hydroelectric production.
What’s missing is a way to store any excess energy that renewables generate for use when that energy is no longer supplying power. For example, on March 11, Portugal generated 143 percent of its power from renewables but it did not have the storage capacity from advanced batteries or pumped hydro to enable the power to be used at a later time. But, the economics of advanced battery technology is a long way off. Clearly, storage solutions are still not developed enough to satisfy energy needs.
The European Union’s energy plans calls for interconnectors, especially electricity cables, to allow surplus energy to be shifted from one member state to another depending on demand. Member states are supposed to hit a 10 percent interconnection target by 2020, meaning a tenth of generated electricity can be exported across borders, but EU countries are lagging behind that goal.
Portugal wants to overcome its isolation from the rest of Europe through third-party interconnectors. In this vein, a cable across the mouth of the Mediterranean to Morocco is being constructed.
Electricity Price Impact
As the renewable production rose, the price of electricity fell by about 10 percent compared to the year before. But, that is little consolation since Portugal’s electricity prices are among the highest in the European Union.
The statistics below show electricity prices for households in Portugal semi-annually from 2010 to 2017. For example, in the first half of 2017, the average electricity price for households was 22.84 euro cents per kilowatt hour (28.22 U.S. cents per kilowatt hour). That’s more than double the U.S. residential price of electricity.
Electricity prices for households in Portugal from 2010 to 2017, semi-annually (in euro cents per kilowatt-hour)
Weather conditions in Portugal during March of 2018 helped production from renewable sources with wet and windy weather producing high levels of hydroelectric and wind generated electricity. Despite these high renewable levels, renewable energy was not able to be produced when needed, so imported electricity and fossil fuel generation were used to keep the lights on. Because batteries and other advanced storage technologies are not currently cost-effective, the excess generation from renewables cannot be stored to be used at a later time. Portugal does not expect to be 100 percent renewable until 2040, and it already pays more than twice what people in the United States do for electricity.