Market Trends of Portugal Distributed Solar Energy Industry
This section covers the major market trends shaping the Portugal Distributed Solar Energy Market according to our research experts:
Residential Segment is Expected to Witness Significant Growth
Solar power is a growing source of clean energy in the Portuguese energy mix. At the end of 2020, solar power had a total installed capacity of 1030 MW and an increase of 13.6% from the previous year.
Solar is expected to play a leading role in the Portuguese government's new energy plan, which includes goals of providing 80% of the country's power demand from renewables by 2030 and 100% by 2050, and electrifying 65% of the economy by 2050.
The increasing adoption of solar photovoltaic in the residential sector is primarily driven by expected savings in electricity costs, the need for an alternative source of electricity, and the desire to mitigate climate change risk.
During the forecast period, the share of the rooftop solar PV is expected to increase, on account of decreasing solar PV costs, supportive government policies for residential solar PV, FIT programs and incentives, and targets set by various governments for solar energy.
The cost reductions from residential rooftop solar PV are driven by continuous technological improvements, including higher solar PV module efficiencies which is expected to boost the usage of solar energy in the residential sector for power utilization.
Hence, owing to the above points, residential segment is expected to witness significant growth in the Portugal distributed solar energy market during the forecast period.
Supporting Government Initiatives Expected to Drive the Market
The government of Portugal has initiated various steps to boost its rooftop solar in the country. Some of the significant initiatives are the Decreto-Lei 162/2019 legislation, and auctions for solar projects.
The legislation is expected to improve self-consumption guidelines issued in 2014 by providing a clearer and more favorable framework for the deployment of small and middle sized renewables projects like rooftop solar.
Additionally, the provisions establish to sell excess power to the spot market or through bilateral power purchase agreements.
In October 2020, the government auctioned 700 MW solar projects. Out of the total 670 MW was allocated, of which 483 MW is allocated to solar PV linked to storage facilities.
Hence, such initiatives like likely to increase solar energy market share (3.8% in August 2021), and thus would drive the distributed solar energy market in Portugal.
