Because there is such a tiny risk of Portugal’s energy supply network running out of power, the government is stopping the annual payment made for EDP’s power stations that ensure their ‘availability to produce.’Secretary of State for Energy, Jorge Seguro Sanches, said the expensive stand-by arrangement no longer is needed as an analysis of the national electricity system for 2018/19 by REN, finds "no relevant risks that compromise security and guarantee of supply, requiring, even in extreme scenarios, a power reserve margin."
A government decree published on Tuesday addresses the annual deliberations as to this stand-by cost that EDP is allowed to charge consumers.
The power guarantee works as a kind of insurance, paid for by electricity consumers, to ensure that the power stations are kept available for production in order to meet any level of demand.
The decree admits that the scheme may have to continue this year but the Secretary of State for Energy says it certainly will not be put into practice next year, unless the European Commission says it must stay as part of a wider energy security plan.
Jorge Seguro Sanches, explained that "it does not make sense" with the current capacity of the national electricity system, to maintain this subsidy given to power plants, as this just puts everyone’s bills up.
Jorge Seguro Sanches, explained that "it does not make sense" with the current capacity of the national electricity system, to maintain this subsidy given to power plants, as this just puts everyone’s bills up.
The Secretary of State said that next year a new evaluation will be made, taking into account the increasingly important contribution of renewable energy, which in March this year produced enough electricity for Portugal’s needs. (HERE)
This power incentive scheme, which credits EDP and Endesa, would end up costing consumers €309 million between now and 2032, according to estimates by the Energy Services Regulatory Agency (ERSE).
The president of power station operator Endesa, said of the subsidy, "This is not a subsidy. I am obliged for 24 hours to have a team available and to have fuel there."
Nuno Ribeiro da Silva questioned whether, "a police officer is only paid when he arrests someone," stressing that this does not happen "because there is a prevention and security role."
Comments
But if he discontinues this payment, we should not expect our bills to decrease. That would be too logical.
If I draw it back a few minutes later, they charge 12 cents.
I don't know about the particular payment in the article, but there's clearly a lot of murkiness around EDP and their deep reach into the government and consumers pockets.