Energy Efficiency Policies and Measures in Portugal

Transcription

1 Energy Efficiency Policies and Measures in Portugal ODYSSEE- MURE 2010 Monitoring of EU and national energy efficiency targets ADENE Agência para a Energia Lisbon, November 2012

2 Contacts: António Almeida ADENE Agência para a Energia Rua Dr. António Loureiro Borges, 5-6º, Miraflores - Arquiparque Algés - Portugal Tel.: / Fax: antonio.almeida@adene.pt The sole responsibility for the content of this publication lies with the authors. It does not necessarily reflect the opinion of the European Communities. The European Commission is not responsible for any use that may be made of the information contained therein.

3 Energy Efficiency Policies and Measures in Portugal in 2012 Contents Page 1 Executive Summary Key messages The Background to Energy Efficiency Overall economic context Energy consumption trends: by fuel and by sector The policy background to energy efficiency Overall Assessment of Energy Efficiency Trends Overall trends in energy intensity Industry Households Services Transport Assessment of energy efficiency/savings through ODEX: total and by sector CO 2 -emissions trends Energy efficiency measures Recent Energy Efficiency Measures Patterns and Dynamics of Energy Efficiency Measures Innovative Energy Efficiency Measures Energy efficiency measure evaluations Semi-quantitative Impact Estimates of Energy Efficiency Measures... 56

4 II Lessons from Quantitative Energy Efficiency Measure Evaluations National Developments under the EU Energy Efficiency Directive and the 20% Energy Efficiency Target of the EU Annex 1: Energy Efficiency Measure Summary by Country Annex 2: Country Profile

5 Energy Efficiency Policies and Measures in Portugal in 2012 Index of Figures Figure 1 - Contributions to GDP growth in volume [Source: INE - Statistics Portugal, National Accounts]... 5 Figure 2 - Growth rate of GDP [Source: INE - Statistics Portugal, National Accounts]... 7 Figure 3 - Percentage composition of (nominal) GVA [Source: INE - Statistics Portugal, National Accounts]... 8 Figure 4 - Energy consumption trends (ktoe) [Source: Directorate-General for Energy and Geology (DGEG)]... 9 Figure 5 - % of energy consumption by activity sector (2010) [Source: Directorate-General for Energy and Geology (DGEG)] Figure 6 - % of energy consumption by type of fuel [Source: Directorate- General for Energy and Geology (DGEG)] Figure 7 - Consumption of electrical energy by consumption type, 2009 [Source: INE - Statistics Portugal, National Accounts and Directorate-General for Energy and Geology (DGEG)] Figure 8 - Consumption of motor car fuel per inhabitant, [Source: INE - Statistics Portugal, National Accounts and Directorate- General for Energy and Geology (DGEG)] Figure 9 - Energy consumption in households Portugal, 1989, 1996 and 2010 [Source: INE/DGEG - Survey on Energy Consumption in Households] Figure 10 - Portugal Efficiency 2015 Programmes [Source: PNAEE Portugal Energy Efficiency Plan 2015] Figure 11 - Primary and final energy consumption [Source: Directorate- General for Energy and Geology (DGEG)] Figure 12 - Share of primary energy consumption [Source: Directorate- General for Energy and Geology (DGEG)] Figure 13 - Energy dependence [Source: Directorate-General for Energy and Geology (DGEG)] Figure 14 - Energy intensities - primary and final [Source: Directorate-General for Energy and Geology (DGEG)]... 22

6 II Figure 15 - Energy intensity Industry (Mining and Manufacturing) [Source: Directorate-General for Energy and Geology (DGEG)] Figure 16 - Unity consumption steel and paper (toe/ton) [Source: ODYSSEE] Figure 17 - Energy Consumption per unity of private consumption [Source: Directorate-General for Energy and Geology (DGEG)] Figure 18 - Unit consumption of space heating per m2 (with climatic corrections) (koe/m2) [Source: ODYSSEE] Figure 19 - Distribution of energy consumption in households by source type - Portugal, 1989, 1996 and 2010 [Source: INE INE/DGEG - Survey on Energy Consumption in Households] Figure 20 - Distribution of energy consumption in households by source and use type - Portugal, 2010 [Source: INE INE/DGEG - Survey on Energy Consumption in Households] Figure 21 - Energy intensity - Services [Source: Directorate-General for Energy and Geology (DGEG)] Figure 22 - Energy consumption per employee (climate corrected) (toe/emp.) [Source: ODYSSEE] Figure 23 - Transport energy intensity [Source: Directorate-General for Energy and Geology (DGEG)] Figure 24 - Specific consumption of cars (l/100km) [Source: ODYSSEE] Figure 25 - Consumption of road transport of goods per tonne-km (koe/tkm) [Source: ODYSSEE] Figure 26 - Modal split: % in total inland passenger (p-km) [Source: EUROSTAT] Figure 27 - Modal split: % in total inland passenger (p-km) Portugal vs EU 27 (2010) [Source: EUROSTAT] Figure 28 - Modal split: % in total inland freight (ton-km) [Source: EUROSTAT] Figure 29 - Modal split: % in total inland freight (ton-km) Portugal vs EU 27 (2010) [Source: EUROSTAT] Figure 30 - Overall energy efficiency gains (industry, transport, households) since 2000 (%) [Source: ODYSSEE] Figure 31 - Energy efficiency gains in industry [Source: ODYSSEE] Figure 32 - Energy efficiency gains in households [Source: ODYSSEE] Figure 33 - Energy efficiency gains in transport [Source: ODYSSEE]... 35

7 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 34 - GHG emissions (without LULUCF) [Source: Portuguese Environmental Agency - APA] Figure 35 - Primary energy consumption trends and share of fossil/renewables in 2010 [Source: Directorate-General for Energy and Geology (DGEG)] Figure 36 - GHG emissions per capita, per unit of GDP and energy consumption [Source: INE - Statistics Portugal and Directorate-General for Energy and Geology (DGEG]] Figure 37 - GHG emissions without LULUCF [Source: Portuguese Environmental Agency - APA] Figure 38 - GHG emissions in Portugal by sector: 2010 [Source: Portuguese Environmental Agency - APA] Figure 39 - National Energy Certificate Figure 40 - SGCIE Synthesis of application Figure 41 - Solar thermal impact in the household consumption [Source: MEE Medida Solar Térmico 2009] Figure 42 - Evolution of accumulated capacity [Source: APISOLAR] Figure 43 - Micro-generation (kw) ( ) Figure 44 - Recommendation made by experts [Source: Asiepi - Portugal Impact, Compliance and control of Legislation] Figure 45 - Potential shift in the distribution of energy rates [Source: Asiepi] Figure 46 - Energy rating (real) before recommendations (2011) [Source: ADENE] Figure 47 - Evolution of number of records on database Figure 48 - Operator s desegregation according to final energy consumption Figure 49 - Number of records until October Figure 50 - SGCIE targeted consumptions Figure 51 - Energy sources used (toe) Figure 52 - ISP exemption impact... 67

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9 Energy Efficiency Policies and Measures in Portugal in 2012 Index of Tables Page

10 2 Energy Efficiency Policies and Measures in Portugal in Executive Summary This report aims to present an analysis of the main energy efficiency trends in Portugal, covering the national macroeconomic context as well as each activity sector, referring the changes occurred in the country within the period between 2000 and 2010, based on the national collected data, international sources and on energy efficiency indicators, taken from ODYSSEE database. This report maintains a significant part of the texts of the previous country report of the ODYSSEE-MURE dating from October 2009, because the content is relevant and still updated, since the time frame between the reports is relatively short, and the effects or impacts of the programs/ measures only occurred from 2008/2009. Updated data are indicated, when available. The Impact of the Economic Adjustment Program for Portugal on energy efficiency measures is not considered in this report, because the analysis of the energy indicators is done until Given the importance of this Program and the consequences it entails for the economy, currently and in the future (this program is in force until 2014), and due to its direct impact on the energy sector, we must provide some indicators for Consequences of the implementation of this Program s measures are already visible, compared to 2010: a) Fall in the real GDP by 1.6%; b) Fall in the Private Consumption by 3.9%; c) Reduction in primary energy by 1.0%; d) Decrease in final energy by 4.5% e) Decrease in road fuels by 7.0%; f) Reduction in electricity consumption by 2.6%. This year, the macroeconomic indicators show even more negative values than in 2011, according to the data of the first three quarters of the year. The sharp contraction of the economy and its impact on the economic activity and on the household disposable income will cause a decrease in overall energy consumption (primary and final). The transport and industry sectors will be the most affected ones in terms of energy. The high fuel prices and the significant drop in the auto industry sales (which fell 31%, compared to 2010, and from January to August of this year; the fall was even greater

11 Energy Efficiency Policies and Measures in Portugal in 2012 than 40%, compared to 2011), will lead to a sharp drop in demand for fuels, thereby reducing the consumption in the energy sector. Since October 2011, prices of all fuels have to be charged at the standard rate of VAT (23%). Until that date, the rate was 5% (reduced VAT), for electricity and natural gas, and 12% for the heating oil and diesel for agriculture purposes. Similarly, and already this year, VAT increased from 13 to 23%, in the acquisition of equipment using renewable energy. In 2012, the tax incentives ceased to be attractive to individuals. It can only be deducted 100 euros in tax incentives on tax income, for installing solar panels, heat pumps for sanitary water heating or double glazing, etc. (with the exception made for taxpayers in the lowest income range, for whom there will be no limits). In the past, one could deduct a maximum of 803. Furthermore, 2012 is also the last year that taxpayers may use this tax benefit. Thus, it is expected that in the coming years, the overall energy performance of Portugal can be somehow affected, in contrast to what occurred during the 2000s, particularly from During the period , Portugal showed significant improvements in relation to energy efficiency. In general, the primary and final energy intensities have decreased, as well as the sectorial ones; the primary energy consumption has decreased; the energy efficiency of primary production has improved, transmission and distribution of electricity have improved, the incorporation of renewable energies has increased; the energy dependency has decreased and CO 2 emissions has decreased. The structural plans for the energy sector, as the PNAC - National Allocation Plan for Emission Allowances (2006), the PNAEE/NEEAP - National Energy Efficiency Action Plan (2008) and the Strategic Transport Plan (2009), as well as the measures established throughout the decade, had not only a very important role in improving the overall energy performance of the country, but also contributed greatly to the reduction of CO 2 emissions from fossil fuels, which decreased by almost 20% compared to

12 4 Energy Efficiency Policies and Measures in Portugal in Key messages Reduction of primary energy by about 9% compared to 2000; Lower energy dependence: from 88.8% in 2005 to 77.1% in 2010; In 2010, 23% of total primary energy consumption came from renewable sources; The primary and final intensities of GDP, compared to 2000, decreased by 15% and 6.7%, respectively; CO 2 emissions from fossil fuels decreased by 20% compared to 2000; In terms of final energy consumption, the oil products account for 51% (in 2000, represented 58%) of total consumption. On the other hand, the consumption of electricity increased from 19% in 2000 to 25% in The transport sector is the largest consumer of energy (37%), followed by industry (30%); The energy intensity of the transport sector decreased by about 8.4%, between 2000 and One can highlight the good performance of some specific indicators of the sector. Portugal remains a country with poor use of public passenger transport and maintains a high rate of road transport of goods; The tendency for energy consumption in the services sector to grow - in 2000, represented 10% of total energy consumption and in 2010, 12%. The energy consumption of the household sector represents 17% of total final energy consumption. The energy intensity of the sector fell by about 10%, compared to This sector was the one with the biggest gains in terms of energy efficiency. The energy intensity of the VA of the industry sector, despite having shown a significant improvement between 2006 and 2009, decreased by only 1% compared to The accumulated energy savings in relation to the 1th NEEAP are equivalent to ktoe, representing an accomplishment of 37% of the 2015 target.

13 Energy Efficiency Policies and Measures in Portugal in The Background to Energy Efficiency 3.1 Overall economic context In terms of GDP development, the period can be divided into two phases: one between 1995 and 2000, of intense GDP growth at an average rate of 4.2%; the other from 2001 onwards, of quite moderate growth, of around 0.7%, which incorporated the 2003 and 2009 recessions. In 2010 gross domestic product (GDP) increased by 1.4% in volume, compared with a - 2.9% change in The contribution from domestic demand to the annual rate of change in GDP in 2010 was positive (0.9 p.p.), in contrast to the previous year (-3.6 p.p.). In turn, net external demand continued to contribute positively to the rate of change in GDP (0.5 p.p.), albeit slightly less than in the previous year (0.7 p.p.). Figure 1 - Contributions to GDP growth in volume [Source: INE - Statistics Portugal, National Accounts] The rebound in domestic demand mainly reflected a less sharp reduction of gross capital formation (GCF), from -13.3% in 2009 to -3.6% in The gross fixed capital formation (GFCF) component which contributed the most to this less sharp reduction of GCF was transport equipment, which grew by 1.7% in volume (-21.8% change in the previous year). GFCF in construction recorded a less intense negative change (from - 6.6% in 2009 to 4.2% in 2010). This was also the case for GFCF in other machinery and equipment (from -9.9% in 2009 to 6.3% in 2010). Final consumption expenditure increased by 1.8% in volume in 2010, conversely to the previous year (-0.7% change), and there was a rise in household final consumption expenditure (rates of change of -2.3% and 2.1% in 2009 and 2010, respectively). The 5

14 6 Energy Efficiency Policies and Measures in Portugal in 2012 behaviour of private consumption was partially influenced by the anticipation of purchases to the end of 2010, especially cars. This was due to a rise in the standard VAT rate and the vehicle tax, starting at the beginning of 2011, but also to the end of tax incentives to the scrapping of not purely electric end-of-life vehicles. General government final consumption expenditure decelerated, recording a change of 0.9% (4.7% in the previous year). The growth of this component in 2010 was largely associated with the import of military equipment, and therefore had a virtually nil impact on GDP. On the external demand side, there were considerable increases in both international trade flows. The most intense rise in exports compared with that of imports translated into a positive contribution from net external demand to GDP growth. Exports of goods and services increased by 8.8% in volume in 2010, in contrast to the previous year (10.9% decline). Imports of goods and services, reflecting a rebound in global demand, also increased, with a 5.4% change (10.0% decline in 2009). It should be noticed that the evolution of imports in 2010 was strongly influenced by the above-mentioned purchase of military equipment. In nominal terms, the external balance of goods and services shifted from -7.4% of GDP in 2009 to -7.2% in This 0.2 p.p. improvement was associated with the more intense volume growth of exports vis-àvis imports, since the price rise in imports exceeded that of exports. In fact, export and import deflators recorded rates of change of 4.2% and 4.8% in 2010 respectively, while in the previous year there had been significant gains in terms of trade due to the rates of change in export and import prices of 5.0% and -9.2%, respectively. The increase in the import deflator was stronger in the last three quarters of 2010, especially in the fourth, reflecting an increase in the price of a number of commodities (notably crude oil and by-products).

15 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 2 - Growth rate of GDP [Source: INE - Statistics Portugal, National Accounts] From the production approach, gross value added (GVA) increased by 1.3% in 2010, after a 2.2% decline in the previous year. This mainly reflected the contribution of GVA in industry, with an increase in sales to both the domestic and external markets in 2010, stronger in the latter. Trade and repair of motor vehicles, hotels and restaurants, and financial, insurance and real estate activities stood out for making the most intense positive contributions to the change in total GVA. In 2010 there was a negative change in GVA only in agriculture, forestry and fishing, and construction, although less sharp than in the previous year. Throughout the series started in 1995, service activities have changed in volume, on average, more than the rest of the economy. This, jointly with a change in relative prices also generally favourable to service activities which are by nature less subject to foreign competition has contributed to relatively higher nominal changes in the respective GVA. Between 1995 and 2009 the structure of the economy s total GVA changed markedly (see Figure 3), stress being laid on a considerable increase in the relative weight of services, in contrast to a significant decline in the relative importance of industry and agriculture. 7

16 8 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 3 - Percentage composition of (nominal) GVA [Source: INE - Statistics Portugal, National Accounts] 3.2 Energy consumption trends: by fuel and by sector During the period under review ( ), the final energy consumption has remained almost constant (17.3 Mt). Regarding the consumption of the activity sectors, they revealed different evolutions: the industry consumption decreased by 2% and 2.4%

17 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 4 - Energy consumption trends (ktoe) [Source: Directorate-General for Energy and Geology (DGEG)] 2.4% in the transport sector. The energy consumption in the residential sector grew by only 0.4%, being the services sector the one that registered the largest increase in the energy consumption, 12.5%, compared to Regarding the energy consumption desegregation by activity sector, there is a small increase in the services sector, from 10% in 2000 to 12% in Industry and transport lost one percentage point compared to 2000 and the residential weight remained the same (17%). 9

18 10 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 5 - % of energy consumption by activity sector (2010) [Source: Directorate-General for Energy and Geology (DGEG)] However, with respect to the distribution of energy consumption by fuel type, the Figure 6 - % of energy consumption by type of fuel [Source: Directorate-General for Energy and Geology (DGEG)] changes are significant: the petroleum products (mainly diesel, gasoline and LPG) in 2000 represented 58% of the total consumption, in 2010 only represented 51%; coal almost lost expression, representing only a marginal value of 0.3%. On the other hand, electricity has seriously increased from 19% (2000) to 25%, and natural gas from 4% to 8% in As concerns to electricity, from 2000 to 2009 electrical energy consumption per consumer rose on average by 1.1%, translating into an overall increase of approximately 9.8 billion kwh (+25.3%). Although the highest share of electricity consumption was the responsibility of the industrial sector (35.1%), domestic consumption represented an

19 Energy Efficiency Policies and Measures in Portugal in 2012 important part of total electricity consumption (29.1%), concentrating 84.8% of total consumers. In 2009 total electrical energy consumption continued to follow the downward trend started in 2008, falling by 0.8%. The total number of consumers dropped for the first time in 2009, by around -0.02%. In Portugal the production of electrical energy in cogeneration plants was started in However, its weight in total production has remained virtually unchanged since then (around 12% of the total). Figure 7 - Consumption of electrical energy by consumption type, 2009 [Source: INE - Statistics Portugal, National Accounts and Directorate-General for Energy and Geology (DGEG)] Annual average growth of car fuel consumption per inhabitant was virtually nil in the decade ended in 2009, although with an uneven development profile. It increased strongly until 2004 and reached a peak that same year (around 0,71 toe/inhabitant), subsequently decreasing at an annual average rate of -3.5%. Overall, 6.1 million tonnes of car fuel were consumed in 2009, with diesel accounting for the highest share, i.e. around 75.8% of the total. Car fuel consumption, as measured by sales of distribution companies, has been decreasing especially in the most recent years, falling by 1.8% in This was chiefly due to the behaviour of unleaded 95 octane motor spirit sales, which in 2009 declined by around 10% from the previous year. Diesel, which remained the most important car fuel in terms of overall consumption, grew by about 3% on average in the past decade (its weight went up from 69.1% in 1999 to 75.8% in 2009). 11

20 12 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 8 - Consumption of motor car fuel per inhabitant, [Source: INE - Statistics Portugal, National Accounts and Directorate-General for Energy and Geology (DGEG)] LPG consumption (auto gas) has been stable since 1999, when this fuel appeared for the first time. However, in recent years (2007 to 2009) there has been an increment in sales of around 35%. According to the results of the Survey on Energy Consumption in Households held in 2010 (Portuguese acronym: ICESD 2010), Portugal has witnessed a change in energy consumption habits of households over the past 15 years. Figures taken from the ICESD 2010 showed that total energy consumption was estimated at 5,902,024 toe in the reference period.[1] Energy consumption in vehicles used in the individual transport of household residents accounted for 50.6% of the total, and for the first time this figure was higher than energy consumption in households (49.4%). Vehicle consumption accounted for 21.8% of the total in 1989 and 37.8% in Overall energy consumption per household was 1.5 toe on average, including vehicles consumption. Total energy expenditure was estimated at 7,245,256,634 for the same reference period, with 54.4% corresponding to expenditure on fuel used in the vehicles of household residents. Overall energy expenditure per household was, on average, 1,843 including expenditure on vehicles.

21 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 9 - Energy consumption in households Portugal, 1989, 1996 and 2010 [Source: INE/DGEG - Survey on Energy Consumption in Households] 3.3 The policy background to energy efficiency At the last years the main tool towards to energy efficiency was the National Action Plan for Energy Efficiency Portugal Efficiency 2015 (PNAEE), also designated Portugal Efficiency 2015, approved by the Council of Ministers Resolution no. 80/2008, 16th of May, comprises a vast series of energy efficiency programmes and measures, with a 2015 timeline, fundamental for Portugal to achieve and surpass the objectives set within the scope of the European Directive no. 2006/32/CE of the European Parliament and Council, of 5 April The NEEAP, approved by the Council of Ministers Resolution no. 104/2006, of 23 August, and the National Energy Strategy, approved by the Council of Ministers Resolution no. 169/2005, of 24 October, already included a vast set of energy efficiency measures. The present plan brings greater ambition and cohesiveness to energy efficiency policies, including all sectors and grouping the various approved measures and an extensive series of new measures in 12 specific programmes. The main objective is to establish implementation of energy efficiency measures leading to a 10% reduction in final energy consumption as a target to achieve by 2015, within the terms foreseen in the aforementioned Directive, regarding efficiency in final use of energy and energy services. The PNAEE encompasses four specific areas, for which guidelines of an essentially technological nature will be issued: Transports, Residential and Services, Industry and 13

22 14 Energy Efficiency Policies and Measures in Portugal in 2012 State. Additionally, three transversal action areas are also defined - Behaviours, Taxes and Incentives and Financing, which were object of complementary analysis and guidelines. Figure 10 - Portugal Efficiency 2015 Programmes [Source: PNAEE Portugal Energy Efficiency Plan 2015] Each of the aforementioned areas includes a series of programmes, which integrate a vast range of energy efficiency measures, aimed at reducing energy demands. The Transports area includes three programmes aimed at improving energy efficiency: Vehicle Renewal Programme, including various measures aimed at improving energy efficiency in vehicles, namely equipment renewal and use of more efficient products. Urban Mobility Programme, which identifies measures related with public transport modal and commuting needs in large urban and corporate centres. Energy Efficiency System in Transports, which aims to quantify the impact of the concepts of logistics platforms and motorways of the sea on efficient use. The Residential and Service area includes three large energy efficiency programmes: Home Renewal Programme, which defines various energy efficiency measures involving lighting, electrical appliances, consumer electronics and area rehabilitation. Renewable at the Time Programme, oriented towards increased penetration of own-production energies in the residential and service sectors.

23 Energy Efficiency Policies and Measures in Portugal in 2012 The Industry area is covered by a programme designated Energy Efficiency System in the Industry, which includes replacement of the Energy Consumption Management Regulations (Decree Law no. 58/82) with new regulations, the Intensive Energy Consumption Management System (SGCIE). Some transversal measures aimed at the industrial sector should be highlighted, aimed at four technological groups: electric motors, heat and cold generation, lighting and other industrial process efficiency measures. The State area is grouped in a programme designated Energy Efficiency in the State, which includes a series of measures aimed at State buildings and transport fleets, Street Lighting and centralised energy negotiation by the central and local administration. The Behaviours area includes programmes aimed at promoting energy-efficient consumer habits and attitudes, such as efficient product recommendation, through awareness and communication campaigns. The Taxes area includes a series of measures aimed at promoting energy efficiency through tax benefits, such as creation of fast depreciation regimes for efficient equipment and establishment of links between the IRS benefits regime and the Energy Certification system for buildings, as well as renewable energies. The Incentives and Financing area includes a series of innovative programmes, such as creation of the Energy Efficiency Fund, incentives for creation of Energy Service Companies (ESCO) and incentives for urban rehabilitation and electrical appliance acquisition and renewal. Implementation of this plan allows energy savings of approximately 1,792 thousand tonnes of oil equivalents (toe), in 2015, which corresponds to savings of 9.8% for the reference period defined in the Directive. The savings achieved exceed the target defined by the European Union by approximately 20%, through efficiency contributions given by the various activity sectors, of which the State leads, with generated savings of approximately 12%. The energy efficiency levels expected in 2015 will be mostly due to annual savings in Transports, of 729 thousand toe, followed by the transforming Industry, of 418 thousand toe, and the Residential and Service areas, contributing with 330 toe and 150 thousand toe, respectively. The State sector will contribute with annual savings of 48 15

24 16 Energy Efficiency Policies and Measures in Portugal in 2012 thousand toe; the Other sectors item, including non-transforming industries, will contribute with 119 thousand toe. Collectively, the measures applied to all these sectors will lead to electricity savings of 4,777 GWh in 2015, corresponding to a 7% reduction in national electricity consumption. Energy Efficiency System in Buildings, which groups measures resulting from the process of energy certification in buildings, namely insulation, improvement of glass surfaces and energy systems. Collectively, the measures applied to all these sectors will lead to electricity savings of 4,777 GWh in 2015, corresponding to a 7% reduction in national electricity consumption. Implementation of the energy efficiency programmes defined will result in final energy consumption rationalisation, with a consequent average annual reduction in energy growth rates of 1.1%, for (relatively to average consumption for the reference period defined in the Directive). In terms of energy intensity, implementation of the present plan will allow Portugal to strengthen its convergence with the current European energy intensity average, calculated since 2006 and currently set at approximately 120 toe/million Euros of the Gross Domestic Product (GDP). This efficiency increase objective will result in a reduction equivalent to 11 toe/million Euros of the GDP, an achievable objective for both economic growth scenarios (high and low scenario). [Source: PNAEE Portugal Energy Efficiency Plan 2015]. This Plan is known as the first NEEAP. The second NEEAP revises the original NEEAP and introduces new measures and targets to The 1 st NEEAP status ( ) and main changes to the 2 nd NEEAP will be described on chapter 6. Significant policy developments 1- Management Structure of the National Energy Efficiency Action Plan (NEEAP) Decree-Law no. 50/2010 of 20 May creates the Energy Efficiency Fund (EEF) aimed to fund programs and activities to finance the implementation of measures included in the NEEAP. This Decree-Law establishes the creation of a management structure, already

25 Energy Efficiency Policies and Measures in Portugal in 2012 foreseen in the NEEAP, to support and promote the implementation of its programs and measures, including the technical management of the Fund. Following the previously mentioned legislation, Ordinance no. 1316/2010 of 28 December was published to regulate and set NEEAP s management structure. This Ordinance identifies the bodies and competencies of the management structure, the organisations involved and the allocation of responsibilities for the management and implementation of measures, as well as the procedures for monitoring and evaluation of results and the procedures for inclusion of new programs and measures. Also specifies, that the NEEAP is structured in four specific areas predominantly technological (transport, residential and services, industry and State), and three cross-cutting areas (behaviours, taxation, incentives and financing) which in turn are divided into programs and measures, as described in the Resolution of the Council of Ministers no. 80/2008 of 20 May. 2. Implementation of the CHP Directive (First amendment) In August 23, 2010, Decree-Law no. 19/2010 was published as amendment, by parliamentary consideration, to Decree-Law no. 23/2010, in particular regarding the articles related to the legal regime applicable to the remuneration of electrical and mechanical energy and useful heat produced in cogeneration. 3. Regulation for Electric Mobility in Portugal - technical requirements Under the National Energy Strategy 2020, on November 29, Ordinance no. 1201/2010 was published, establishing the rules for running the business of operating charging points of the electric mobility network, including the installation, provision, operation and maintenance of battery-charging points for electric vehicles, with access to public or private, which have been integrated into the network of electric mobility. This Ordinance also establishes the technical requirements which the granting of license to exercise the business operation of charging points of the network of electrical mobility is subject and some procedural rules. 4. Regulation for Electric Mobility in Portugal - licenses for the installation of charging points Under National Energy Strategy 2020, on November 29th, the publication of the Ordinance no. 1202/2010 has establishes the rules for licenses for private use of public domain, for the installation of batteries charging points to the electric vehicles, in public places for public access. Also stipulates that when there are areas involving water fields, public or private, as defined under Decree-Laws no. 54/2005 of November 15, 17

26 18 Energy Efficiency Policies and Measures in Portugal in 2012 and no. 58/2005 of 29 December, the rules of these diplomas shall be considered, in particular, should be obtained the necessary evidence of use of water resources. 5. Regulation for the Management of the Energy Efficiency Fund (EEF) Decree-Law no. 50/2010 of 20 May creates the Energy Efficiency Fund (EEF), aiming to fund programs and activities that support the measures included in the NEEAP. Under this legislative act, Ordinance no. 26/2011 was published on January 10, defining the financial support system for measures and programs eligible for the Fund. This regulation is intended to coordinate the funding and support process for projects aiming the implementation of programs and measures that lead to reduce the final energy demand contributing to the compliance of national targets on energy efficiency. 6. Energy Efficiency Programs in Public Administration (ECO.AP) In January 2011, as part of the National Energy Strategy (ENE2020) and the National Energy Efficiency Action Plan (NEEAP), the Portuguese Government launched the Energy Efficiency in Public Administration Programme (ECO.AP). This programme aims to achieve a 20% increase in energy efficiency by 2010 in all public services and public administration bodies, particularly through the procurement of energy service companies (ESCOs). ECO.AP covers a set of measures from the appointment of energy managers by all public bodies to the implementation of energy efficiency management contracts between those bodies and ESCOs, as well as, the establishment of a public administration energy efficiency barometer and the definition of a national White Certificates Scheme. Decree-Law no. 29/2011 passed in February 2011 created the legislative framework for drawing up and implementing energy efficiency management contracts between the State and other public bodies with ESCOs. Contract models and ESCOs qualification procedures are being developed to facilitate the implementation of the initiative. 7. Public Contract Regime with the Energy Service Companies (ESE) Under the National Energy Strategy 2020, Decree-Law no. 29/2011, of 28 February, was published aiming to establish a role for the public sector in the promotion and development of an energy services market, as well as the adoption of measures to improve end-use energy efficiency. This legislation regulates the use of ESE (ESCOs), through a competitive tender process, allowing these companies to identify potential energy savings in buildings and

27 Energy Efficiency Policies and Measures in Portugal in 2012 public facilities and to implement procedures for enhancing energy efficiency, reflected in the final energy bill. Decree-Law no. 29/2011 also establishes the procedures for the formation and conclusion of contracts between public administration bodies and energy service companies, with a clear commitment on simplified and objective models for the evaluation of proposals. 8. Financial Incentives Under the National Strategic Reference Framework (QREN) five tenders were published to support energy efficiency in public lighting and traffic lights through the Regional Operational Programmes for the five regions in mainland Portugal. With a total budget of EUR 26 million, these financial incentives were targeted to municipalities, associations of municipalities, metropolitan areas, as well as to municipal, intermunicipal or metropolitan enterprises and municipal services. Submission of proposals was possible until the end of July and results are expected by end Concluding/additional remarks The program of the new government has established guidelines for the national energy policy, taking in account the measures included on the memorandum of understanding signed by Portuguese authorities with the IMF, the ECB and the EU. The energy policy will be developed around the following priorities: improve the energy efficiency of the country (25% reduction in consumption by 2020), with the State leading by giving the example (30% reduction by 2020); enhance the diversification of primary energy sources, reduce dependence on oil in the country and achieve the target of Renewable Energy fixed on the European Directive; create an economically sustainable energy mix that set affordable energy prices for all segments in the economy; liberalize energy markets, making them highly competitive, with transparent mechanisms for setting prices and stable regulation. 19

28 20 Energy Efficiency Policies and Measures in Portugal in Overall Assessment of Energy Efficiency Trends 4.1 Overall trends in energy intensity Primary and final energy In the last decade the final energy consumption decreased by about 9%, while the final energy consumption has remained almost constant (decreased by 0.6%). Figure 11 - Primary and final energy consumption [Source: Directorate-General for Energy and Geology (DGEG)] The decrease in primary energy consumption was due to: - Improvement of the energy efficiency of electricity production (commissioning of combined cycle plants); - Lower losses in the transmission and distribution of electricity; - Greater uptake of renewable energy, in The renewable component accounted for 23% of the total primary energy consumption, which is a record value in Portugal; - Increase of mini and micro production; - CHP; - Greater efficiency in end-use.

29 Energy Efficiency Policies and Measures in Portugal in 2012 It is also important to note the changes that have occurred over the past decade concerning the composition of primary energy sources. As it can be seen in Figure 12, oil remains the main source of primary energy. Currently, represents 49% of total primary energy consumption, while in 2000 accounted for 62%. Similarly, there was a significant decrease in coal, representing only 7% of the total primary in Renewables are now the second source of energy and account for nearly ¼ of the total primary consumption. Natural gas has gradually replaced oil and coal, representing 1/5 of the primary consumption compared with 8% in Figure 12 - Share of primary energy consumption [Source: Directorate-General for Energy and Geology (DGEG)] Energy dependence In the last 5 years, Portugal showed a significant improvement with respect to its energy dependence. In this period, the dependence on foreign energy fell by 11 percentage points, accounting the value of 76.7% in Nevertheless, the cost of energy imports cost the country 5.5 billion, equivalent to 3.4% of the GDP. In 2010, this high cost was also due to the combination of two negative factors: more expensive market prices of energy raw materials (compared to previous years), including the barrel of brent and the devaluation of the euro against the dollar. 21

30 22 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 13 - Energy dependence [Source: Directorate-General for Energy and Geology (DGEG)] Primary and final energy intensities The intensities of the primary and final GDP decreased significantly. In relation to 2000, the primary intensity decreased by 15% and the final by around 6.7%. Figure 14 - Energy intensities - primary and final [Source: Directorate-General for Energy and Geology (DGEG)]

31 Energy Efficiency Policies and Measures in Portugal in 2012 The good performance of these indicators is due on one hand to the significant reduction of primary energy consumption (cited above) and also, due to more efficient use of the final energy. 4.2 Industry The evolution of the energy intensity of the industrial sector of the GVA between 2000 and 2009 reveals two distinct periods. From 2000 to 2006, it was almost always growing, revealing low energy efficiency, and then, it reverses that trend in a accentuated manner (efficiency improvement) until In balance, between 2000 and 2009, the energy intensity of the industrial sector decreased by only 1%. Figure 15 - Energy intensity Industry (Mining and Manufacturing) [Source: Directorate-General for Energy and Geology (DGEG)] The chemicals, metals and paper were those that contributed most to improving the energy efficiency in industry. For instance (figure 16) from 2000 to 2010 the unity consumption (toe/ton) has decreased around 7%, and as concerns to the paper sector more than 14%. 23

32 24 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 16 - Unity consumption steel and paper (toe/ton) [Source: ODYSSEE] 4.3 Households Between 2000 and 2010, energy consumption per unit of private consumption - energy intensity of the residential sector, showed overall a very positive trend, decreasing in this period by about 10%, accounting in 2010 about 28 toe/m (2010). Figure 17 - Energy Consumption per unity of private consumption [Source: Directorate-General for Energy and Geology (DGEG)] Regarding energy consumption per m 2 (unit consumption) from to 2010, this indicator of energy efficiency has significantly improved, from 2.2 to 1.4 koe/m 2.

33 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 18 - Unit consumption of space heating per m2 (with climatic corrections) (koe/m2) [Source: ODYSSEE] Following the ICESD 2010, as regards energy consumption in households, electricity was the main consumed energy source in the reference period, accounting for 42.6% of total energy consumption in households. This energy source underwent the greatest changes vis-à-vis the latest surveys (15,8% in 1989 and 27,5% in 1996). Firewood was the second main consumed energy source in Portuguese households, with a weight of 24,2% in total energy consumption in homes, stress being laid on its loss of importance in the past few years (60,3% in 1989 and 41,9% in 1996). Figure 19 - Distribution of energy consumption in households by source type - Portugal, 1989, 1996 and 2010 [Source: INE INE/DGEG - Survey on Energy Consumption in Households] Taking into account the different energy uses in households, the use of energy in kitchens recorded the highest weight, i.e. around 39%, compared with other types of use. It was followed by energy use for heating water, with 23%. However, depending on the type of use, the predominant energy source was different, given that the use of electricity was predominant in kitchens, whereas for heating water preference was given to LPG bottles. 25

34 26 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 20 - Distribution of energy consumption in households by source and use type - Portugal, 2010 [Source: INE INE/DGEG - Survey on Energy Consumption in Households] Electricity consumption assumes a major role in the domestic sector, since most equipments used this type of energy source. The increment of electricity consumption is directly associated with an increase in thermal comfort and a growing number of electrical appliances in households. The results of this survey show that the total electricity consumption in households was toe (equivalent to GWh), meaning that on average, each Portuguese household consumed toe. Considering the final use of electricity, it becomes clear that consumptions in the kitchen and in electrical appliances were the highest, being responsible for, respectively, 41% and 33% of the overall electricity consumption. The consumption of renewable energy (charcoal, firewood and solar thermal) in the domestic sector accounted for about 25% of total energy consumption in households and firewood is the source with a most relevant contribution. 4.4 Services The evolution of the energy intensity of the GVA of the services sector showed a negative trend between 2000 and 2004 and since then the trend has changed, dropping significantly until In the period under review, the energy intensity decreased by 4.4%.

35 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 21 - Energy intensity - Services [Source: Directorate-General for Energy and Geology (DGEG)] Similarly, the energy consumption per employee (climate corrected) also decreases in period under review, from 0.70 toe/ employee to 0.66 toe/ employee (a reduction of about 13%, compared to 2000) Figure 22 - Energy consumption per employee (climate corrected) (toe/emp.) [Source: ODYSSEE] 4.5 Transport The evolution of the energy intensity of GDP of the transport sector between 2000 and 2010 decreased approximately by 8.4%. 27

36 28 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 23 - Transport energy intensity [Source: Directorate-General for Energy and Geology (DGEG)] The Improvement of the energy efficiency of the transport sector is due to several factors. Is exemplified in the case of passenger transport, the decrease in specific consumption of cars, which decreased by about 6.3% between 2000 and Figure 24 - Specific consumption of cars (l/100km) [Source: ODYSSEE] Similarly, in the freight transport sector, there was also a significant improvement of the energy performance in relation to energy consumption per unit t-km, as one can see in the following figure.

37 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 25 - Consumption of road transport of goods per tonne-km (koe/tkm) [Source: ODYSSEE] This consumption decreased by about 7% during the period under review. Passenger transport Modal split of passenger transport Figure 26 - Modal split: % in total inland passenger (p-km) [Source: EUROSTAT] One can see that there was a slight increase in the component of private cars instead of public transportation use. However, this component does not differ much from the 29

38 30 Energy Efficiency Policies and Measures in Portugal in 2012 EU 27 average (see Figure 27). The component most affected was the transport by bus, which in 2000 represented 13.6% of passengers transported, and in 2010 it went to 10.9%. Figure 27 - Modal split: % in total inland passenger (p-km) Portugal vs EU 27 (2010) [Source: EUROSTAT] Modal split of freight transport As for the land transport of goods, the road transport clearly dominates over rail, as seen in Figure 28 Portugal is still far from the European average. In 2010, the rail freight of goods, which consumes less energy per t-km moved, in Portugal represented only 6.1% compared to 17.1% of the EU 27 average (see figure 29).

39 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 28 - Modal split: % in total inland freight (ton-km) [Source: EUROSTAT] Figure 29 - Modal split: % in total inland freight (ton-km) Portugal vs EU 27 (2010) [Source: EUROSTAT] 31

40 32 Energy Efficiency Policies and Measures in Portugal in Assessment of energy efficiency/savings through ODEX: total and by sector Total The overall energy efficiency gains are calculated from ODEX and reflects efficiency gains since ODEX by sector (industry, transport, households) is calculated from unit consumption trends by sub-sector (or end-use or mode of transport) by aggregation of unit consumption indices by sub-sector in one index for the sector on the basis of the current weight of each sub-sector in the sector s energy consumption. Service sector is excluded because of lack of reliable data to capture energy savings in this sector. Figure 30 - Overall energy efficiency gains (industry, transport, households) since 2000 (%) [Source: ODYSSEE] Industry The energy efficiency gains on industry are calculated from ODEX and reflect efficiency gains since ODEX in industry is calculated from unit consumption trends by branches by aggregation of unit consumption indices by branch in one index for the sector on the basis of the current weight of each branch in the sector s energy consumption. For industry, the evaluation is carried out at the level of 11 branches: 5 main branches: chemicals, food, textile & leather, machinery, transport vehicles; 3 energy intensive branches: steel, cement and pulp & paper

41 Energy Efficiency Policies and Measures in Portugal in residual branches: other primary metals (i.e. primary metals minus steel), other nonmetallic minerals (i.e. non-metallic mineral minus cement) and miscellaneous branches. The unit consumption is expressed in terms of energy used per ton produced for energy intensive products (steel, cement and paper) and in terms of energy used related to the production index for the other branches. Figure 31 - Energy efficiency gains in industry [Source: ODYSSEE] Residential The energy efficiency gains on residential sector are calculated from ODEX and reflect efficiency gains since ODEX in households is calculated from unit consumption trends by end-uses/equipments (8 of which: heating, water heating, cooking, refrigerator, freezer, washing machine, dishwashers and TV) by aggregation of unit consumption indices by end-uses in one index for the sector on the basis of the current weight of each mode in the sector s energy consumption. For each end-use, the following indicators are considered to measure efficiency progress: Heating: unit consumption per m 2 at normal climate (toe/m 2 ) Water heating: unit consumption per dwelling with water heating Cooking: unit consumption per dwelling Large electrical appliances: specific electricity consumption, in kwh/year/appliance 33

42 34 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 32 - Energy efficiency gains in households [Source: ODYSSEE] Transport The energy efficiency gains on transport sector are calculated from ODEX and reflects efficiency gains since ODEX in transport is calculated from unit consumption trends by modes (7 of which: cars, trucks and light vehicles, motorcycles, bus, rail, inland waterways and air) by aggregation of unit consumption indices by mode in one index for the sector on the basis of the current weight of each mode in the sector s energy consumption. Index equal to zero: means no savings due to the fact that non technical savings exceed technical savings. For each mode/transport vehicle, the following indicators are considered to measure efficiency progress: litre/100 km for cars, goe/ton-km for trucks and light vehicles toe/passenger for air transport, goe/pass-km for passenger rail, goe/t-km for transport of goods by rail and water, toe per vehicle for motorcycles and buses.

43 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 33 - Energy efficiency gains in transport [Source: ODYSSEE] In general, the energy efficiency gains of Portugal according to the methodology of ODYSSEE were positive, achieving the most significant gains in the residential and transport sectors. 4.7 CO 2 -emissions trends In 2010, total Portuguese GHG emissions without land-use, land-use change and forestry (LULUCF) were estimated at about 70 Mt CO 2 e, representing an increase of 17% compared to 1990 levels. Under the EU burden-sharing agreement, Portugal is bind to limit its emissions in the first commitment period to +27% compared to the 1990 level. Figure 34 - GHG emissions (without LULUCF) [Source: Portuguese Environmental Agency - APA] 35

44 36 Energy Efficiency Policies and Measures in Portugal in 2012 After a steady increase of the Portuguese emissions during the 90s, the growth of emissions has been more moderate and started to stagnate in the early 2000s, registering thereafter, in particular after 2005, a decrease. These trends reflect largely the evolution of the Portuguese economy which was characterized by a strong growth associated to the increase of energy demand and mobility in the 90's, and to the more recent situation of stagnation or even recession in the Portuguese economy. In most recent years, however, this relation started to change and a decoupling of the emissions growth from the economic activity can be observed. This situation is in part consequence of the implementation of some measures, such as the introduction of natural gas (1997), the installation of combined cycle thermoelectric plants using natural gas (1999), the progressive installation of co-generation units, the amelioration of energetic and technologic efficiency of industrial processes, the improvement in car efficiency and the improvement of fuels quality. Furthermore, in most recent years there has been an expressive development and installation of equipments for the use of renewable energy sources with a particular expansion of windmills. The trends of the most recent years have however been strongly influenced by the slowdown in industrial activity and consequent reduction in fuel consumption, and the cessation of some activities in the country such as the production of ammonia in 2009 with the relocation of the production facilities to India. Another fact to note is the introduction of the use of high performance catalysts and optimization of the ratio ammonia / air in the production of nitric acid which had an influence in the decrease of emissions. The principal source of GHGs in Portugal in 2010 is the energy sector. The largest gas emitted is CO 2 representing approximately 75% of total GHGs emissions expressed as global warming potential (GWP) weighted emissions. The majority of these emissions are generated in energy-related activities, which are responsible for almost 92% of total CO 2 emissions. This situation is primarily related to the pattern of energy sources used in Portugal. In average, during the period , 83% of the primary energy consumed was produced from fossil fuel combustion (coal, oil and natural gas) whereas the renewable energy represents the remaining part, i.e. 17% in average (Figure 35). The situation is however changing in the most recent years, with a progressive increase of the renewable energy sources such as wind.

45 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 35 - Primary energy consumption trends and share of fossil/renewables in 2010 [Source: Directorate-General for Energy and Geology (DGEG)] Notes: Hydroelectricity: domestic production. Others: includes fuel wood, wastes, and biogas. Fossil fuels: includes coal oil and natural gas. Renewables: includes domestic hydroelectricity and others. The average annual emissions growth rate for the overall period is less than 1%. However, as illustrated in there are roughly three different periods that can be identified in terms of the annual average rate evolution: from 1990 to ,7%; from 1995 to per cent, and since 2000 a more moderate increase and a decreasing tendency since 2005 can be recognised. Driving factors for emissions growth are amongst others, economic growth and higher energy demand, increasing road transport volume and distance driven supported by strong development of road infrastructure and rapid growth in private car ownership. Climatic variables, such as precipitation, which vary to years have also a significant effect on hydropower generation and then produces substantial inter-annual variations in emissions. During the 1990s Portugal experienced a significant economic growth with an increase in GDP of about 40% in the period , corresponding to an average annual increase of 2,1%. The most rapid growth occurred from the years 1993 to 2000, where the average annual growth rate reached the 4,1%. Since 2001, economic growth slowed considerably, contributing, at least partially, to the more moderate emissions growth registered in the most recent years. During the period analysed, the country has achieved a decoupling of emission trends from economic growth, in particular for the most recent years. The decrease of carbon intensity (GHG emissions per GDP unit) observed in the recent years (figure 36), is 37

46 38 Energy Efficiency Policies and Measures in Portugal in 2012 surely related to the implementation of some important measures that had a positive effect in the emissions levels, such as the introduction of natural gas (1997), the installation of new combined cycle thermoelectric plants using natural gas (1999), the progressive installation of co-generation units, the amelioration of energetic and technologic efficiency of industrial processes, the improvement of car efficiency and fuels quality. Figure 36 - GHG emissions per capita, per unit of GDP and energy consumption [Source: INE - Statistics Portugal and Directorate-General for Energy and Geology (DGEG]] The overall trend for direct GHG emissions without LULUCF in the period is presented in figure 37.

47 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 37 - GHG emissions without LULUCF [Source: Portuguese Environmental Agency - APA] According to the UNFCCC Reporting Guidelines, emissions estimates are grouped into six large sectors: Energy, Industrial Processes, Solvent use, Agriculture, Land-Use Change and Forestry, and Waste. The figure below represents direct GHG emissions by sector for Figure 38 - GHG emissions in Portugal by sector: 2010 [Source: Portuguese Environmental Agency - APA] Energy is by far the most important sector, accounting for 71% of total emissions in 2010, and presenting an increase of 21% over the period. Energy 39

48 40 Energy Efficiency Policies and Measures in Portugal in 2012 industries and transport are the two most important sources representing respectively 21% and 27% of total emissions. This reflects the country heavy dependence on fossil fuels for electricity generation and transportation, which have grown steadily until the mid 2000s due to the continued increase of electricity demand driven in particular by the residential/commercial sector, and the growth of mobility. The situation seems to have changed in the most recent years were we can observe stagnation or even decrease of these trends. Transport sources, which are largely dominated by road traffic, are one of the sectors that have risen faster. In the period these emissions increased 84 per cent, due to the steady growth of vehicle fleets and road travel, in association with the increase in family income and the strong investment in road infrastructure in the 90s. Indirectly the increase in road traffic activity also augmented the emissions from fossil fuel storage, handling and distribution. However, this situation has changed in the last years, as the growth of transport emission has started to to decline in most recent years. Agriculture, was in the period analyzed, one of the most significant sources of GHG emissions, and was responsible for 10,7% of the Portuguese emissions in 2010, corresponding to a decrease of 6%4 since The waste and industrial processes sectors represented, respectively, 10,1% and 8,1 % of the country emissions in 2010, recording an increase of approximately 18% and 21,4 %since Solvent use represents less than 1% of total emissions, and is mainly related to NMVOC emissions1. The accounting of land use change and forestry category are still under revision. According to the last estimates the sector is estimated to be a net sink in the whole period, representing a sequester of -11,3 Mt CO 2 equivalent in These are converted into ultimate carbon dioxide after being emitted to atmosphere

49 Energy Efficiency Policies and Measures in Portugal in Energy efficiency measures 5.1 Recent Energy Efficiency Measures Residential and Tertiary Sector With the introduction of the European Energy Performance Directive for Buildings (EPBD), on 4 April 2006, the Official Journal published three Decrees, setting out the framework for National System for Energy and Indoor Air Quality Certification of Buildings (SCE): Decree 78/2006 It creates and defines the operational rules for the System for Energy and Indoor Air Quality Certification of Buildings (SCE) articles 7 & 10; Decree 79/2006 It establishes the new revision of the Regulations for HVAC systems, including requirements for regular inspection of boilers and airconditioners (RSECE) articles 8 & 9; Decree 80/ It establishes the new revision of the Thermal Regulations for Buildings (RCCTE) articles 3 to 6. In 2007, two other legislative documents were published: Ordinance nº 461/2007 (5 June 2007) establishes the timetable for implementation of the certification process and Ordinance nº 835/2007 (7 August 2007) defines the fee to be paid to SCE for the central registration and validation of certificates issued by qualified experts. These new legislation establishes higher thermal requirements and adds strict indoor air quality requirements as well as maintenance and periodic inspections during the lifetime of HVAC systems. Within the new legal impositions it is worth to point out the mandatory use of solar collectors in buildings. Under this new codes changes observed, although evolutionary, with improvements of the already existing codes; almost duplicating the thermal performance request in the new and renovated buildings, adding stricter indoor air quality requirements as well as maintenance and periodic inspections during the lifetime of HVAC systems, had also some innovative issues. SCE came into force on 1 July The timetable to implement the SCE in various types of buildings is divided into three phases until its full implementation in January 2009, when all the required buildings will be included in the certification system: new 41

50 42 Energy Efficiency Policies and Measures in Portugal in 2012 buildings, major renovations, public buildings and all buildings when sold or rented. In the first phase, certification is only required for all new residential and non-residential buildings with a floor area larger than 1,000 m2 and requesting a construction permit after July 1, The second phase includes all new buildings, regardless of their floor area, when they request a construction permit after 1 July The system operates in conjunction with two sets of building regulations applied to construction, the Regulations on Thermal Behaviour of Buildings (RCCTE) and the Regulations on HVAC Systems in Buildings (RSECE). The Energy Certificate is the most visible aspect of the SCE. This document will assign an energy performance label to residential and non-residential buildings and it may list measures for improving their energy performance. The energy label classifies the buildings on an efficiency scale ranging from A+ (high energy efficiency) to G (poor efficiency). This is similar to the scale currently used for some domestic appliances and equipment (although classes A and B are evenly subdivided in to classes A+, A, B, B-, to improve the distinction among new buildings all new buildings must be in the A+ to B- classes) and it allows for easy reading and interpretation by the consumer.

51 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 39 - National Energy Certificate In Portugal, certification has been adopted by the market. Nearly all licensing (new buildings) and transaction processes (existing buildings) have a certificate. The new DIRECTIVE 2010/31/EU of 19 May 2010 on the energy performance of buildings (recast), brings a series of changes, including most importantly the abolition of the 1000 m 2 limit for the application of the regulations in the case of large renovations; an intensification of the inspection procedures and of the quality of the energy performance certificates issued; the requirement, in 2020, of all new buildings to present an energy balance close to zero, and consumption should be covered by renewable energy sources; and assigning greater responsibility to the public sector, which should serve as an example in applying the regulations. The new EPBD further defines that the minimum requirements follow the principle of economic viability, ie taking into account savings in energy consumption during the entire life of the building. 43

52 44 Energy Efficiency Policies and Measures in Portugal in 2012 Transport Sector Under the Ministries Council Resolution nº 161/2005, of 12the October, the current vehicle tax was amended. From the 1st of July 2006 on, the tax calculation formula includes also an environment component part, besides the cylinder capacity (CC) component. The purchase tax on vehicles begins to be weighted according to engine size and CO 2 emissions, being the weighting of the last, raised over time. So the integration of the environment part in the tax calculation formula will be made annually progressively, reducing the cylinder capacity component, favouring the less pollutant vehicles. This environmental component, represented by CO 2 emissions, will be differentiated according to the type of fuel used, taking in consideration the environmental damages and harmful for the public health caused by the respective fuels consumption. Initially the CO 2 emissions will have a weigh of about 10 % on the purchase tax vehicle. However, it is expected that gradually the weigh will be increased: 2007 CO 2 emissions represent about 30 % 2008 CO 2 emissions represent about 60 % In order to avoid any negative impact in the market, the Government will establish the suitable calendar for the beginning of the tax model to be in force, taking in consideration the adaptation of the representatives of vehicle s brands to these new rules. The annual tax changes are to be included in the annual national Budget legislation. Specifically, in what respects 2006 budget, changes are in force from 1of July 2006, under Law 60-A/2005, December 30 th, in what respects 2007 budget, changes are in force under Law nº53-a/2006 of 29 December The Vehicle Taxation Reform was enacted by Law 22-A/2007, of 29 June, and entered into force in July 2007, creating the Vehicle Tax Code (ISV) and the Road Tax Code (IUC) while abolishing the Automobile Tax (IA), the Municipal Vehicle Tax (IMV) and the Road Usage and Haulage Tax (ICi and ICa). As such, the most significant amendments are regarding:

53 Energy Efficiency Policies and Measures in Portugal in 2012 An increase in the proportion of the tax based on environmental factors, such as carbon dioxide (CO 2 ) emissions, from its current weighting of 10% to 30% and later 60%; The spread of vehicle taxation over two periods, with some of the tax burden involved in purchasing a vehicle (ISV) being transferred to the period of usage (IUC). IUC is charged based on ownership, with the vehicles identified (cars, motorcycles, boats, planes) classified into seven categories, from A to G, each with its own specific rates. The EU Directive 2003/30/EC on the use of biofuels in the transport sector has been transposed to the Portuguese legislation, under Decree-law nº62/ st March, providing for the following measures to promote the use of biofuels: The possibility of imposing minimum quotas for the incorporation of biofuels in fossil fuels if biofuel incorporation the previous year was considerably lower than expected; The conclusion of agreements for the use of biodiesel in public passenger transport and goods transport fleets, with a percentage rate of biodiesel incorporation in fossil fuels above 10%; The creation of the title of 'dedicated small producer' for firms producing up to tonnes annually from waste materials or by means of technological development projects based on products that are more environmentally friendly. Together with this legislation it was also published a specific Decree-law establishing the fiscal incentive for the biofuels promotion (Decree law nº 66/2006, 22nd March). Biofuels profit from total exemption (for dedicated small producers - until a maximum of tons biofuel/year) or partial exemption on the excise tax ISP (tax rate on oil products) of about EUR/ litre, depending on the prices of biofuels, their feedstock and fossil fuels. The total or partial exemption was allowed for a maximum period of six years, and is applied to pure biofuels or when blended to petrol or diesel. Order in Council No 1554-A/2007 of 7 December 2007 set the quantities to be exempted and the corresponding access conditions for the years 2008 to The national indicative target for the placing on the market of biofuels and other renewable energies for transport purposes was increased for 2010 by the Council of Ministers Resolution from 5.75% (Resolution No 119/2004 of 31 July 2004) to 10% (Resolution No 1/2008 of 4 January 2008). 45

54 46 Energy Efficiency Policies and Measures in Portugal in 2012 Decree-Law No 89/2008 was published on 30 May 2008, laying down fuel specifications and providing for the placing on the market of fuels with a 10%, 15% and 20% biofuel mix. In order to place on the market fuels with larger biofuel contents than those permitted by Standards EN590 and EN228, a warning must be given to consumers instructing them to check the compatibility of their vehicles. MOBI. E project Early in 2008, the Portuguese Government launched a national Program for Electric Mobility. The program aims at creating a new approach at Electric Mobility, based on an innovative electric mobility model designed in view of creating the first national wide infrastructure at global level. The MOBI.E electric mobility model is a fully integrated and totally interoperable system, multi-retailer and multi-operator. In practice, a national electric mobility system that allows any individual the access to any provider of electricity in any charging point explored by any service operator. This ensures transparency, low entry barriers and competition along the value chain, and runs under a business and service model that takes advantage on the growing importance of electricity produced with basis on renewable energy. Portugal is one of the first countries in the world to have an integrated policy for electric mobility and a national charging network for Electric Vehicles. A pilot phase, consisting on the introduction of a national wide public network of normal and 50 fast charging points, will be fully implemented by the first semester of 2011 in the main 25 cities, thus allowing electric vehicle users the ability to travel throughout the country with comfort and safety. This will be complemented by private partners, building a wide and comprehensive network, including street, public car parks, shopping centres, service stations, hotels, airports and private garages. The first MOBI.E charging point was inaugurated on June 29th Industrial Sector The Intensive Energy Consumption Management System (SGCIE) was published on 15 April 2008, trough Decree-Law 71/2008, being one of the measures of the NEEAP - National Action Plan for Energy Efficiency that results of an extension up to 2015 of the measure of the PNAC 2006 (Climate Changes Plan), relative to the revision of the RGCE- Regulation of Energy Consumptions Management.

55 Energy Efficiency Policies and Measures in Portugal in 2012 The objective of this measure is to promote the increase of energy efficiency through the modification of production processes, the introduction of new technologies and the behaviors changes. The SGCIE applies for all companies and facilities that have an annual consumption over 500 toe/year, imposing binding energy audits, with a 6-year periodicity, in energyintensive facilities with consumption above 1000 toe/year, and a 8-year periodicity for energy audits to facilities with energy consumption between 500 and 1000 toe/year. Facilities under the National Allocation Plan for Emission Allowances (PNALE) are not covered by SGCIE, but they may participate on a voluntarily basis, as can facilities with annual energy consumptions lower than 500 toe. Intensive energy users are obliged to elaborate and execute Energy Consumption Rationalization Plans (PREn), establishing targets for energy and carbon intensity and specific energy consumption, which also outlines energy rationalization measures. The Plan must be submitted to the DGEG through an online system ( to the Directorate General for Energy and Geology (DGEG), as well as submit as biennial execution and progress reports. Upon DGEG s approval, as the competent authority that supervises and inspects the SGCIE's operation, the PREn become a Rationalization Agreement for Energy Consumption (ARCE). The ARCE provides facility operators with excise duty exemptions (ISP) on oil and energy products (coal, oil coke, fuel oil and oil gases), as well as possibility to apply for incentives on energy audit costs and on investments in energy management and monitoring equipment. Exemptions in excise duties are foreseen in the national budget for fuels used either by consumers committed to the reduction of CO 2 emissions in the framework of the National Allocation Plan for Emission Allowances (PNALE) or by consumers that have a Rationalization Agreement for Energy Consumption. 47

56 48 Energy Efficiency Policies and Measures in Portugal in 2012 Delivery of Plan online 2 year report Audit Online registration Website SGCIE Agreement Plan Penalities Installation registration Registration of installations from previous regulation RGCE Recognition of technicians and entities for audits Energy Audit Elaboration of Energy Rationalization Plan (PREn). Delivery and online approval of the Plan Approved plan converted in Energy Rationalization Agreement Online delivery of Execution and Progress Reports (REP) every 2 years Application of penalties when targets aren t achieved or measures aren t implemented Figure 40 - SGCIE Synthesis of application The aggregate value of ISP exemption has greater impact on consumers of fuel oil in a total value of 760,000 Euros. As mentioned before by the end of each PREN period operators must reduce their target indicators in 4% or 6% depending if they have reference energy consumptions over 500 toe/year or under 1000 toe/year respectively. Cross-cutting measures Resolution of the Council of Ministers (RCM) No 169/2005 of 24 October 2005 laid down a National Energy Strategy with the following objectives: To ensure security of energy supply by diversifying primary sources and energy services and promoting energy efficiency throughout the supply and demand chain; To stimulate and foster competition with a view to protecting consumers and promoting competitiveness and efficiency in enterprises both in the energy sector and in Portugal s production sectors; To provide for an environmentally friendly energy process as a whole by reducing the impact on the environment at local, regional and global level, in particular in terms of the carbon intensity of GNP. To achieve those aims, the National Energy Strategy involves various policy strands, which will translate into instruments to be defined and adopted by legislative and regu-

57 Energy Efficiency Policies and Measures in Portugal in 2012 latory means. The policy guideline for renewables involves expanding these energy sources, in particular by stepping up and diversifying the use of renewable sources of energy to produce electricity, with special focus on wind power and hydroelectric potential still to be exploited, and raising the target for wind power to MW. The following measures were taken in accordance with those guidelines: Decree-Law No 33-A/2005 of 16 February 2005 revised the prices paid for energy produced by renewable-energy power plants and delivered to the public electrical grid, and laid down the procedures for allocating the power available on the grid and the time required to obtain authorizations to establish such power stations. A public call for tenders was published in July 2005 under Decree-Law No 33- A/2005 for the supply of MW of electricity to the public electrical grid from new wind farms. A public call for tenders was published in March 2006 under Decree-Law No 33- A/2005 to deliver 100 MW of electricity to the public electrical grid from 15 thermoelectric power plants using forest biomass, with special emphasis on priority areas for the management of forest fuel where there are no investment plans as yet. The aim is to promote the valorization of forest biomass in conjunction with the timber and paper-pulp industries. The call seeks to achieve two aims: to increase the share of electricity generated from renewables through a network of forest-waste collection plants and to contribute to keeping forests clear and so reduce the risk of forest fires. The forecast is for annual consumption of around one million tonnes of waste from forest management and production activities. Contracts for reception points for 922 MW from major new hydroelectric plants were awarded at an estimated investment of over 1 billion. A license was awarded for the establishment of the Moura photovoltaic power plant, Europe s largest, with forecast production of 76 GWh a year. Work was begun on a maritime area for the establishment of pilot projects to develop new technologies utilizing this energy potential and permitting the establishment of an industrial cluster dependent on wave energy. Operation commenced of the world s first wave-power plant with a capacity of 4 MW. Under Order-in-Council No 736-A/2006 of 26 July 2006, CEO (Companhia de Energia Oceânia S.A.) was authorized to install the infrastructure for an electricity 49

58 50 Energy Efficiency Policies and Measures in Portugal in 2012 generating system that harnesses sea-wave power using Pelamis wave-energy converters in a public maritime area off Aguçadoura (on Portugal s centralwestern coast). Law No 57/2007 of 31 August 2007 provides the legal basis for government use of public maritime areas, including territorial waters, for the production of electricity from sea-wave power in an area demarcated to that end. In early 2007 new targets for renewable energy were approved: - Electricity generated from renewable energy sources is to rise from 39% to 45% of consumption in 2010, with significant development of all sectors; - Biofuels are to rise from 5.75% to 10% of road-transport fuel consumption in 2010; - 5% to 10% of the coal used in the Sines and Pego power plants is to be replaced by biomass or waste by Decree-Laws numbers 101/2007 of 2 April 2007 and 288/2007 of 17 August 2007 lay down amendments and provide for measures to simplify and streamline licensing procedures in the electricity sector, and in particular in renewable-energy plants. Decree-Law No 225/2007 of 31 May 2007 amending Decree-Law No 33-A/2005 of 16 February 2005 provides for a set of measures involving renewables under the National Energy Strategy, and in particular clarifies the procedure for assessing environmental impact, revises the criteria for paying for energy produced from renewables and simplifies licensing procedures. A plan was drawn up with a view to building 10 new dams ( MW) in addition to the Baixo Sabor dam. The government approved a new simplified system for the production of electricity using micro-generation plants, also known as Renováveis na Hora ( instant renewables ).

59 Energy Efficiency Policies and Measures in Portugal in Patterns and Dynamics of Energy Efficiency Measures The following figures shows the dynamics of the national energy efficiency measures under graph spider form, from 1990 to 2010 (national measures and those triggered by EU measures) in the different demand sectors. This examination is based on the Mure Database on energy efficiency. This database covers a number of rational energy related policy measures, a coverage that has been updated over the years The total number of measures available in the database by sector, up to 2010, is: Household 15 Tertiary 12 Transports 23 Industry 3 General cross-cutting measures 7 In Annex 1, it is presented a summary of each measure. Residential Sector 51

60 52 Energy Efficiency Policies and Measures in Portugal in 2012 Transport Sector Industrial Sector

61 Energy Efficiency Policies and Measures in Portugal in 2012 Tertiary Sector Cross-cutting measures 5.3 Innovative Energy Efficiency Measures The policies and measures recommended in the National Climate Change Programme have been developed. With regard to the energy field, continuous investment has been made in renewable energy resources, especially wind power, licensing of new natural gas combined cycle plants, which are more efficient in producing electricity. The expected results/impacts up to 2010 are as follows: 53

62 54 Energy Efficiency Policies and Measures in Portugal in 2012 Wind Energy: creation of an industrial cluster with a total investment of 1750m, creation of roughly 1700 work posts and the setting up of a fund of 35m for innovation in the area of renewable energies; Forestry Biomass: an estimated investment of around 225m and the creation of roughly 700 work posts; Biofuels: creation of industrial unit with an estimated investment of 100m; Water: Authorized Reception Points for 922 MW of new large Hydroelectric Power Stations with an estimated investment of more than 1000m; Wave Energy: creation of a pilot zone with potential exploration of up to 250 MW for the technological development of new technologies pilot projects and the drawing up of legislation regulating the respective authorizations (licenses and concessions); Photovoltaic: Moura Power Station with a forecast production of 56 GWh/year, the setting up of a photovoltaic module factory and a research laboratory. Serpa Power Station with a forecast production of over 18 GWh/year; The following picture shows the national impact of renewable energies as key economic, environmental, social and technological development drivers. As regards micro-generation, a simplified legal licensing system was implemented, substituting the existing one with a registration system subject to an inspection of technical conformity.

63 Energy Efficiency Policies and Measures in Portugal in 2012 The System for the Registration of Micro-production (SRM), from renewable energy sources was regulated under the provisions of Decree-Law, no. 363/2007, November 2nd, and became effective on April, 2008, covering renewable energy sources as solar, wind, hydro, biomass, and fuel cells using hydrogen from renewable energy microgeneration, and cogeneration. This legislation provides a simpler simplified licensing process for any entity with a contract for purchasing low-voltage electricity, through an electronic platform through with producers register their installations, subject to technical compliance inspection. The micro-generation installations are limited to half of the installed rate power in the households, with a maximum limit of 5,75 kw in the general regime and 3,68 kw in the subsidize regime (except in the case of installations for condominiums). The tariff under the general regime is equal to the cost of electricity sold under the purchasing contract. As an alternative the special tariff regime establish a special reference tariff of 650 /MWh valid during the first 5 years following the installation year, decreasing 5% for each additional 10 MW registered in the SRM. The reference tariff applies differently depending on the conversion technologies that use renewable energy sources. It is 100% for solar, 70% for wind, 30% for hydro, cogeneration and biomass. For fuel cells, the tariff is the one that applies to the renewable energy source used for hydrogen production. Solar energy uses for space heating and hot water production is mandatory under the subsidize regime. A minimum of 2 m 2 of solar thermal collector area should be installed in the same building as each micro-generation plant. The Portuguese government prepared during 2008 the introductions of direct incentives for the purchase of solar thermal systems as a way to reduce the costs of solar thermal systems, thereby helping to surpass the high initial investment associated to their acquisition. Up to 50 % of the cost of the full solar thermal system and installation services, with a maximum amount of 1.641,70, will be granted over this initiative. The incentive will be made available through bank credit agreements. The final objective to achieve is the creation of a sustained market, representing installation of m2 of solar collectors per year, which will result in approximately 1.4 million m2 of installed operational collectors by 2015, corresponding to approximately 1 in 15 buildings with Solar Thermal systems. 55

64 56 Energy Efficiency Policies and Measures in Portugal in 2012 Estimated energy savings associated to installation of solar thermal systems, corresponding to the indicated area, are 58,796 toe, in 2015, for the residential and service sectors. Figure 41 - Solar thermal impact in the household consumption [Source: MEE Medida Solar Térmico 2009] 5.4 Energy efficiency measure evaluations Semi-quantitative Impact Estimates of Energy Efficiency Measures In the first half of 2009, thermal solar systems were installed in roughly 20,000 houses under the Thermal Solar Programme; this corresponds to over 65,000 m 2 of solar panels installed and a total investment of roughly 65 million euros with 50% State participation. There are currently more than 6000 certified installers. These technicians are qualified to install solar panels in accordance with the quality level required by the Thermal Solar Programme. Figure 42 shows the evolution of accumulated capacity. According to the estimates, 875,874 m 2 solar panels (613,112 kw th ) were installed until 2011.

65 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 42 - Evolution of accumulated capacity [Source: APISOLAR] In relation to the demand by type of system, 16% are individual collectors, 47% are forced circulation system and 37% are thermosyphon systems. From the individual collectors, 72% intended for residential use (building or housing) and 28% goes to the tertiary sector (pools, hotels, etc.). The implementation of solar panels until 2010 generated energy savings (accumulated) of about 20.8 ktoe. Since the System for the Registration of Micro-generation came into force (April 2008) until to 2011, over registrations were made, resulting on the assignment of a total electric power of 63,6 MW. Solar thermal micro-generation is also encouraged under SCE regulations which value the use of energy sources with lower impact, in terms of primary energy consumption when determining the energy performance of the building. A cumulative energy saving impact of 4,1 ktoe was measured under this programme. 57

66 58 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 43 - Micro-generation (kw) ( ) Under the National Energy Certification and Quality of Air in Buildings System (SCE), were registered until 2011, 476,864 Declaration of Conformity and Regulation (DCR) and issued 353,492 Energy Efficiency Certificates, of which 90% for residential and 10% for services Since the start of the implementation of the Energy Certification System for Buildings (2008) until the end of 2010, the accumulated energy savings accounted for 81.2 ktoe. The Intensive Energy Consumption Management System Programme (SGCIE) came into force in June 2008, taking over after the prior Regulation on Management of Energy Consumption. About 178 ktoe of energy savings (cumulated) were generated under this framework until In 2010, the final energy consumption of transport sector has decreased around 3,4% compared to Between 2008 and 2010, the incentives for the decommissioning of end-of-life vehicles and the review of the private vehicle tax regime, contributed to a reduction in energy consumption (cumulative) of around 80 ktoe. In the same period and also in cumulative terms, the modal transfer in Lisbon, Porto and district capitals gave a reduction in energy consumption of around 98 ktoe.

67 Energy Efficiency Policies and Measures in Portugal in Lessons from Quantitative Energy Efficiency Measure Evaluations Evaluation of building regulation In Portugal the implementation of the EPBD is the responsibility of the Ministry of Economy and Employment. The EPC scheme was launched in July 2007; first for new buildings, and from January 2009 also for existing buildings. The EPCs cover indoor air quality as well as energy performance. The chosen assessment method is calculated rating. The calculation procedures are defined in building regulations. A software tool (INETI) has been available since September 2006, but other tools are also allowed. Calculations have to be done based on a national database regarding regional climates. ADENE, the Portuguese Energy Agency, is the managing body for the EPBD implementation process and plays a big role in the practical implementation of the EPCs. In about 90% of building completions and transactions an EPC is issued, so compliance is high. Compliance is lower in the rental market than in the sale market. There are effective promotional activities by the energy agency ADENE directed at municipalities, stakeholders and key market players involved in construction, home buying and selling to ensure compliance and support of the certification. There is a national database in use for the registration of EPCs. The database is used for policy studies and monitoring and is accessible by the authorities, energy experts (restricted area) and the general public. Results for the policy analysis from the database are used to improve policy, regulations and implementation. The database is also used for random quality checks of the issued EPCs. Compliance is high. ADENE plays a key role in the high compliance rate, because of their efforts in the promotional activities towards municipalities, stakeholders and key market players. In case of non-compliance there is a penalty system with sanctions (fines), both for building owners and experts. Only qualified experts may issue certificates. They must be recognized architects or engineers with at least five years of relevant experience. Qualified experts must attend courses and pass a national exam. ADENE coordinates the training of qualified experts. The license which experts have is valid for five years and will only be renewed when they can provide proof of continued training and a lack of malpractice. 59

68 60 Energy Efficiency Policies and Measures in Portugal in 2012 ADENE regularly performs controls to check the content of issued certificates by independent experts, for which the EPC database is also used. A parallel analysis of the certified building is performed in the control, with an onsite visit. About 4% of the EPCs are checked this way, and additional random checks are done on the content of the certificates (consistency check). The main barrier was to convince key stakeholders of the importance of the EPC scheme. Energy Agency ADENE played a key role in overcoming this barrier, with its information/promotion campaign. Evaluation of energy audits in the building sector The EP requirements for new buildings and major renovations will certainly bring important energy savings in the near future. Maintaining thermal confort and indoor air conditions will require less energy, as new and renovated buildings become more and more efficient. But new and renovated buildings only make up a small share of the entire building stock in Portugal (around 5.5 million homes). Currently, less than new buildings are built each year in Portugal and, despite the recent growth in the rehabilitation market, major renovations still don t have a significant expression. Therefore, the impact of applying EP requirements in new and renovated buildings is obviously limited and will not lead, in usefull time, to a relevant reduction in energy consumption in the building sector. So, to achieve real energy savings in this sector, there has to be good incentives to the improvement of existing buildings. And certification can play a crucial role in this matter. The recommendations made by the experts in the certificate are important guidelines that the owner of the buildings can make good use of, either in the context of a renovation, or as individual cost-effective measures.

69 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 44 - Recommendation made by experts [Source: Asiepi - Portugal Impact, Compliance and control of Legislation] By analysing the certificates issued in Portugal for existing buildings in the first 6 months of 2009, it can be seen that about 40% are rated above the treshold for new buildings (B-). If all the recommendations for improvements made by the experts in each certificate were actually implemented, then about 86% of the existing buildings would have, at least, the same energy performance as new buildings (in terms of primary energy consumption per square meter of floor area). For that, an average investment between 1250 and 6500 per building would be required, for an average payback period for investment of 6 to 11 years. And, in this scenario, Portugal could save about about 0,4 toe of primary energy per building per year. The following figure illustrates the potential shift in the distribution of energy rates for existing residential buildings, as it would result from the actual implementation of all the recommendations made by experts in the certificates issued in the first six months of

70 62 Energy Efficiency Policies and Measures in Portugal in 2012 Energy rating (real)before recommendations Energy rating (estimated) after recommendations A+ 0,4% A+ 5% A 4% A 31% B 25% B 31% B- 11% B- 20% C 33% C 9% D 14% D 3% E F G 2% 4% 7% 40% are above new building s threshold E F G 1% 0,2% 0,1% 86% could be above new building s threshold Figure 45 - Potential shift in the distribution of energy rates [Source: Asiepi] In 2011, for more than certificates issued relating to the existing residential buildings, the profile has not changed significantly. Figure 46 - Energy rating (real) before recommendations (2011) [Source: ADENE] Although theoretical, this analysis emphasises the importance of implementing the recommendations made by the experts in the certificate and how these measures need to go from paper to practice. Therefore, a crucial aspect for the credibility and future of the energy efficiency legislation in Portugal is the quality control or inspection of the expert s work, which is performed by ADENE as the system s managing authority. Such a control mechanism leads a lot of (positive) pressure in the entire system, increasing the level of compliance of the different technical agents involved, particularly engineers and architects. By

71 Energy Efficiency Policies and Measures in Portugal in 2012 the end of 2009, close to 4% of the certificates issued each month will be subject to a detailed quality control. This detailed control involves visiting the site and performing parallel analyses of the certified building. Results of this evaluation are compared with the initial expert s work. If relevant mistakes are detected, the expert is asked to correct the certificate and is also subject to penalties. An additional and lighter control is also performed by ADENE in the form of random checks on the content of the certificate. In case there is wrong or inconsistent information in the certificate, a detailed quality check can be triggered. But in most cases, this mechanism is used to warn experts about possible improvements in the quality of the information they put in the certificate, thus assuring a more or less uniform content to all certificated. At least once every 5 years, each expert will be audited by ADENE to evaluate its correct use of methodologies and tools. About 10% of the certificates will be subjected to this analysis. This control will be financed by the fee paid for registration of each certificate (45 per certificate in residential buildings and 250 per certificate in nonresidential buildings). Inspections of boilers and air-conditioners are covered by the HVAC regulations adopted by the Government on 4 April 2006 and it shall become mandatory from 1 January The procedures for inspection of boilers and air conditioning systems are still under discussion. In the case of non-residential buildings, inspections will be a required part of the HVAC maintenance plan and its execution will be subject to verification by qualified experts when performing periodic audits to the building, once every 2 or 3 years. Transport sector Biofuels represent an area of diversification in the supply of fuel to the transport sector which has recorded the highest growth rates in terms of energy consumption. In Portugal, the transport sector s energy dependency on oil, which is responsible for 42% of total imported oil consump tion, is very high. The replacement of more than 300 million litres of fuel by 2010, comprising the incorporation of 10% in road fuels, bringing the EU s objective forward by 10 years, promotes the creation of industrial plants and development of energy based agriculture. The government set the quantity of biofuels to be exempt from ISP (tax on oil products) at 205 thousand tonnes in Of this amount, tonnes derive from national agricultural production. However, this figure should rise to 405 thousand tonnes by 2010 in light of the forecast increase of the in- 63

72 64 Energy Efficiency Policies and Measures in Portugal in 2012 corporation percentage. The fiscal exemptions (ISP) have been designed to promote the use of biofuels in the transport sector, to reduce Portuguese energy dependency and comply with the Community directive establishing the replacement of 10 per cent of conventional fuels used in the transport sector, by alternative fuels by Small dedicated producers are entitled to total exemption from ISP up to a maximum global amount of 40 thousand tonnes per year. Industry energy audits Until October 2012, 924 intensive energy consuming companies were registered online to imposing binding energy audits, been desegregated in 2 universes: companies exclusively covered by this regulation (new records) and the Emission Trading Scheme (ETS) facilities that although free decided to register or companies that passed from the previous regulation and which will gradually fully be integrated in the SGCIE as new records. Figure 47 - Evolution of number of records on database In the universe of registered operators dominates the number of companies with annual energy consumption higher than 1000 toe/year resulting from the number of registered operators still under RGCE.

73 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 48 - Operator s desegregation according to final energy consumption The following figure shows the distribution of records concerning to the classification of economic activity. Figure 49 - Number of records until October

74 66 Energy Efficiency Policies and Measures in Portugal in 2012 Figure 50 - SGCIE targeted consumptions The existing records in SGCIE equals ktoe and represent 24% of final energy consumption in the sectors of Agriculture and Fishing, Mining and quarrying, Manufacturing and Construction according to the energy balance of The following figure represents the breakdown of energy used forms in energyintensive installations for the new records. Figure 51 - Energy sources used (toe) As regards the implementation of fiscal benefits of the SGCIE, the law 1530/2008 of 29 December with effect from 1 March 2009, sets the oil taxes (ISP) for certain fuels

75 Energy Efficiency Policies and Measures in Portugal in 2012 consumed by industrial companies or facilities that are not ETS or that don t have an Agreement for the Energy Consumption Rationalization (ARCE) under the regulations of the SGCIE. Energy intensive consumers who have an approved plan for rationalization of energy consumption can obtain exemption from the ISP taxes for the industrial fuels classified within codes 2701, 2702, 2704 and 2713, fuel oil with sulfur content of less than 1% falling within code , fuel oil with sulfur content of higher than 1% falling within code to and LPG classified by the code The following figure shows the impact of ISP exemption relating to new records. The cumulative potential 3 of exemption of the ISP taxes has the greatest impact on consumers of fuel oil (total value of 1,211 keuro/year). Figure 52 - ISP exemption impact 67

76 68 Energy Efficiency Policies and Measures in Portugal in National Developments under the EU Energy Efficiency Directive and the 20% Energy Efficiency Target of the EU Status of national action plan and targets The following table shows the implementation progress of the National Energy Efficiency Action Plan (NEEAP): NEEAP Energy Savings ( ) Sector Program 2008 (ktoe) 2009 (ktoe) 2010 (ktoe) Cumulated (ktoe) Target for 2015 (ktoe) % of the target for 2015 already accomplished Renew Car Transport Urban Mobility Energy Efficiency Transport System Residential & Services Industry State Renew Home & Office Energy Certification of Buildings Microgeneration and Solar Thermal Energy Management System of Intensive Energy Consumption (SGCIE) State Energy Efficiency Program (Energy Certification, Solar Thermal, School Microgeneration, Mercury Vapour Light Bulbs,

77 Energy Efficiency Policies and Measures in Portugal in 2012 LED traffic lights Behaviours Operation E (Home Energy) (-) TOTAL Source: ADENE Portuguese Energy Agency Implementation of these measures resulted in ktoe of energy savings in 2010, representing 19.3% of the target for The accumulated value of energy savings, resulting from the implementation of the measures in 2008, 2009 and 2010, is ktoe, showing that Portugal has already reached 36.7% of the 2015 target. The 2 nd NEEAP is not yet approved. However, new measures and new targets for 2016 are planned, integrating the concerns regarding the reduction of primary energy for 2020, the same horizon set for the PNAER/NREAP - National Renewable Energy Action Plan and for the recent Energy Efficiency Directive. Due to the economic situation of the country, some of the measures that appeared on the 1 st NEEAP will be removed. Thus, in the Transport sector the following measures will be eliminated: a) Efficient fluids, due to the downturn in demand for more efficient fuels and lubricants; b) Traffic management platform, because there were no proposed initiatives encompassed in this measure by large urban centers; c) Logistics in Portugal and Motorways of the sea, due to the very high level of investment. In the Residential and Services, the micro-generation measure will be eliminated, because savings are reflected only in the primary energy. The remaining measures from the 1 st NEEAP, which are in force, will be strengthened in the 2 nd NEEAP. New measures will also be added (under discussion), which stands out, the introduction of the agriculture sector. 69

78 70 Energy Efficiency Policies and Measures in Portugal in 2012 The previous plan covered a wide range of sectors - Transport, Industrial, Residential and Services, State and Behaviors, but did not consider any impact from the agricultural sector. The 2 nd NEEAP wants to correct this aspect and to include the contribution of the agricultural sector, which alone accounts for about 3% of the final energy consumption in Portugal, i.e. about 463 ktoe.

79 Energy Efficiency Policies and Measures in Portugal in 2012 Annex 1 Energy Efficiency Measure Summary by Country 71

80 72 Energy Efficiency Policies and Measures in Portugal in 2012 Residential Sector Transport Sector Industrial Sector

81 Energy Efficiency Policies and Measures in Portugal in 2012 Tertiary Sector Cross-cutting measures 73

82 74 Energy Efficiency Policies and Measures in Portugal in 2007 Annex 2 Country Profile

83 Energy Efficiency Policies and Measures in Portugal 2006 Energy Efficiency Trends Overview Over the period , the overall energy efficiency increased around 4% in Portugal, as shown by the decrease of the energy efficiency index (ODEX). The main reason comes from the significant improvement on energy efficiency in residential sector which represents around 17% of final energy consumption. Industry For the same period, the overall energy efficiency of industry has increased only 1%, measured in terms of energy used per production index. However, if the reference year was 1990, the energy efficiency would have increased around 6%. One of sectors with a remarkable improvement as concerns to energy efficiency was the paper sector; in fact, in the last 10 years, the energy efficiency was improved in 11% or in the last 20 years improved more than 25%. Households The significant improvement of energy efficiency (18%) from 2000 to 2010 was mainly due to the introduction of natural gas after 1996, as well as the use of LPG for heat water and space heating, and also the improvement in national building construction in new dwellings, namely the thermal insulation, the use of double glazing and greater use of natural lightening. In addition, the phase-out of incandescent lamps, the acquisition of appliances more efficient and better equipment for space heating has contributed to improve the energy efficiency. Transport Between 2000 and 2010 the overall efficiency of the transport sector shows an increase of 5%. The cars show the same positive impact but even more significant when compared to 1990 (9%). For trucks and light vehicles the energy efficiency has decreased at 1% and the trend seems to point out to a new decrease of the energy efficiency for coming years. This trend could be seen as consequence of economic crisis impact. Energy efficiency index* (base 100=2000) *All indicators measured as a three-year moving average Source ODYSSEE. For more information : 75