Government ploughs €1.58 billion into upgrading electrical grid to meet ‘challenges of energy transition’ – Portugal Resident
The government has approved the Development and Investment Plan for the National High- and Medium-Voltage Electricity Distribution Network (PDIRD-E 2026–2030), with a total planned investment of €1.58 billion.
In a statement issued following the Council of Ministers today, the government stated that “the plan strengthens the resilience and modernisation of the national electricity grid, preparing it to meet the challenges of the energy transition, the growing electrification of the economy and the integration of renewable energy sources”.
Furthermore, it stated, “the planned investments will enable an increase in grid capacity, reduce constraints on connecting new energy generation, consumption and storage projects, and enhance the security and quality of the electricity supply”, as well as speeding up the implementation of investments linked to the Portugal Transformation, Recovery and Resilience (PTRR) programme, it added.
The plan was presented by E-Redes, which manages the national distribution network.
EDP’s chief executive, Miguel Stilwell d’Andrade, explained last year that E-Redes will allocate 20% of the planned investment up to 2030 to strengthening the networks, and that the impact on tariffs will be “negligible”.
In this regard, he highlighted the 50% increase in investment proposed by E-Redes – a company within the EDP group and operator of the national electricity distribution network – to €1.6 billion for the period from 2026 to 2030.
The proposal received a favourable opinion from the Energy Services Regulatory Authority (ERSE) last year, “the first ever without any proposed cuts to investment”, he pointed out.
Detailing the figures set out in the plan that E-Redes is required to submit to the regulator every two years, the group’s chief executive highlighted that “around 45% of the investment will be allocated to modernising the grid, 15% to digitalisation and around 20% to electrification and decarbonisation”.
Finally, given that the issue has gained prominence following the blackout, Stilwell d’Andrade emphasised that “20% of the investment will be allocated to making the grids more reliable and ensuring a robust and continuous service”, in order to keep pace with the increasing integration of renewable energy.”
Today’s news comes on the heels of investors’ warnings that “without investment in the networks it will be difficult to connect all these requests (to establish data centres) on time and at costs that make sense”.
Expresso heard late last year how, in the next five years, the Portuguese association of Data Centres (APCD), estimates that the country will attract €13 billion in data centre investments – “and this does not include the €4 billion investment forecast in the Portuguese candidacy for the construction of an AI gigafactory, promoted by the Banco Português de Fomento, which, if it happens, will be financed by European funds”.
The paper cited one project for Fundão, implying an investment in the municipality of €4 billion, in an infrastructure spread over 80 hectares. Another planned for Abrantes, with the promise of an investment of €7 billion – and this comes “in parallel with various other plans that have been developed in Portugal, where Start Campus (owned by David Kempner and Pioneer Point Partners) already has an investment underway of €8.5 billion – the largest in the country”.
Portugal “has excellent conditions to turn into a digital hub” with an important position in Europe, Luís Duarte, president of APCD told Expresso, because other markets, like Germany, the Netherlands and even Spain, “have become saturated”.
Duarte describes a future where the mere housing of data centres in Portugal could “contribute to Portuguese sovereignty” and add as much as €26 billion to the country’s GDP by 2030… All this on the basis that the niggling issue of electrical capacity can be sorted – an issue that the government now appears to be addressing.
Source material: LUSA/ Expresso
