Environment for RES / Energy Efficiency
SWOT Analysis for RES & Energy Efficiency
  • High solar and wind potential
  • Good electricity grid that can support the penetration of RES.
  • Great potential for exploitation of offshore wind energy.
  • Favourable regulatory framework.
  • High penetration of RES in the electrical system.
  • Cooperation with many European Countries on energy issues and technology transfer.
  • Stable regulatory framework.
  • There is no great potential for exploitation of biomass.
  • High differences in demand.
  • Energy instability.
  • Small progress in energy savings in buildings.
  • Island groups which require special treatment regarding RES.
  • Know-how on RES installations
  • Environmental conscience of residents.
  • High potential of RES.
  • Potential for offshore wind farms.
  • Target to transform Portugal into the main Energy supplier in Europe.
  • Further increasing of RES in order maximize energy autonomy.
  • Incentives for energy savings in buildings.
  • Financing programs for Energy Saving in industrial sector.
  • Heavy dependence on natural gas.
  • Lack of incentives for the development of RES.
  • Changes in the cost of RES technologies.
  • Failure to achieve the target for energy savings.
  • High dependence on the RES may create problems in the energy security of the country.
  • A need for backups from conventional fuels.
  • Highly developed market with achieved targets and limited room for further growth.
Related Programs in EEA Grants 2009-14

Chosen RES / EE Projects

Project Facts:

  • Project Title: Pilot Geothermal Power Plant of 3 MWe on Terceira Island.
  • Project Objective: Increased Renewable Energy Production.
  • Project Promoter: EDA Renewables (EDPR).
  • Initial Project Cost: 4.389.423 €.
  • Target Group(s): Small and Medium-sized Enterprises (SME), Unemployed.

A few words for the philosophy of the project:

Geothermal energy, on the one hand, has many advantages over other forms of renewables, while on the other hand, both the Donor Partner Country (Iceland) and the Beneficiary State (Azores) have geothermal resources.

As a Member State of the EU, the adopted joint legislation and long-term strategic objectives set out several tasks for Portugal in the field of renewable energy utilization. The EU's Renewable Energy Roadmap adopted on the basis of the EU energy and climate package sets a 20% share of renewable energy sources by 2020.

Ambitious goals are stipulated in the 2009/28/EC Directive (RED) on the promotion of the use of energy from renewable sources, on the basis of a National Renewable Energy Action Plan for each country identifying the target numbers.

In this context, the Energy Strategic Plan presented by the Government of the Azores has as main goal to increase the share of renewable energy to 75% of the total electricity produced at the Azores. This strategy expresses the commitment of the region with the EU Directive, having as key objective to increase significantly the proportion of energy generated on the exploitation of the endogenous resources. In particular, Portugal's main investment in geothermal energy is in the Azores, where geothermal energy is widespread in 8 of the 9 islands.

Approximately 30 years after the start of exploitation of geothermal resources for power generation on 550 Miguel Island, the contribution of this energy source takes on an important role, accounting for today about 22% of the power generated in the Azores. The last 10 years were important for the development of the exploration of the geothermal resources in the Azores.

Areas of interest in the development of geothermal energy are shown in the figure below.


However, considering the power market, the Azores Archipelago, Portugal, is dependent on the importation of fuel for energy production. On Terceira Island, replacing 10% of the energy generated by fuel with geothermal energy, would reduce carbon emissions.

In this context, this plan of this project was fully in line with the Energy Strategic Plan presented by the Government of the Azores considering that the main goal is to increase the penetration of renewable energy production to 50% of the total electricity produced in the Region by 2018 from the present value of 36% to reduce oil dependency, towards a clean renewable energy society in the middle of the Atlantic. The pre-defined project finalized a pilot geothermal power plant in the Pico Alto Geothermal Field, Terceira Island, increasing the share of renewable energy by 10% in the total energy production and creating new jobs. Therefore, the project benefits the economy, society and the development of Terceira Island. The National Energy Authority of Iceland is a donor programme partner, collaborating extensively during the planning and implementation of the programme, strengthening cooperation between Iceland and Portugal.

Individual sub-projects:

The pre-defined project included the installation of geothermal plants.


The generation capacity installed was expanded and now covers about 42% of the needs of the Island, while on Terceira Island a new geothermal field has been identified for power generation. Several reconnaissance studies have also been developed in other smaller Islands in order to identify areas with a higher probability of having high enthalpy geothermal resources.

The long-term goal of the project is to promote the exploitation of the high enthalpy geothermal resources in the Azores for power production and consequently replace the fossil fuel in areas that are proven to be economically feasible.

At present, the technology and low demand on these Islands restricts the development of geothermal exploitation projects for energy production.

The power production from renewable sources is cost competitive on the Island of sea Miguel, the largest Island, compared to fossil fuel-based power plants and considering that the nine-small scale independent systems cannot be interconnected. Considering that the existing technology for the exploitation of geothermal energy requires stable and constant production and that, therefore, the geothermal resource is ideal for offering the base load. Apart from the 550 islands of Miguel and Terceira, the electricity demand on each of the other seven Islands is too small to enable the implementation of geothermal projects on a small scale. Additionally, there is also serious restrictions on competition for the provision of drilling services and geothermal power plants, which hampers even more the feasibility of the geothermal development.

Considering the specific nature of the geothermal projects such as the drilling of geothermal well sand construction of geothermal power plants, one of the most difficult issues is the lack of specific regulatory legislation in most of the industry's activities. In particular, the construction of a power plant and the drilling of geothermal wells, are subject to civil engineering legislation, which requires several rules that do not meet geothermal demand. This also happens with regard to the environmental legislation that should be more adapted and flexible with regard to the development of geothermal projects.

Finally, it should be mentioned that the high investments needed for the early exploration stages of geothermal resources, associated with the risk of successful drilling and/or injection wells, supports the need for regulatory legislation for the development of insurance policies to cover the risks of investment during the pro-feasibility stage. To achieve the goals of the Azores Region to promote the use of energy from renewable sources requires to accelerate the utilization of geothermal energy for power production, because the current utilization is still far away from the regional potential, and it can replace the fossil fuels with local resources that reduce the impact on the environment and use instead an energy supply that is safe and reliable. Some good progress has been made so far in the geothermal power generation, but incentives are required based on the current financial market conditions.



Pic. 1: View of the Power Plant in Azores Pic. 2: Pipelines of Water Pic. 3: Main Part of Equipment Pic. 4: Finalization of Geothermal Power Plant Pic. 5: Specified Equipment

Project Facts:

  • Project Title: Courses on Geothermal Energy Utilization Held at the Azores Archipelago.
  • Project Objective: Improved Capacity at National, Regional and Local level on Renewable Energy Solutions.
  • Project Promoter: EDA Renewables (EDPR).
  • Initial Project Cost: 67.202 €.
  • Target Group(s): Manager, Leaders, Teachers, Trainers, Administrators and Technical Staff from Eligible Institutions, Students.

A few words for the philosophy of the project:

Geothermal systems are commonly divided into high-temperature and low-temperature systems.  High temperature systems are defined as systems where the temperature at 1 km depth exceeds 200°C and low-temperature systems as those where the temperature is below 150°C in the uppermost kilometer. The most common way of harnessing geothermal energy is the hydrothermal tank with a borehole to transport the liquid to the surface. With current drilling technology, water with temperatures up to 360°C can be recovered from the upper 2-3 km of the earth´s crust. High temperature geothermal fluid may be carried on the surface as steam, or more commonly as a two phase mixture of water and steam.  A common way of utilization is to separate the two phases and use the steam to move the turbines for electrical generation.  In combined heat and power plants, the waste heat from this process is used for direct heating applications, thus allowing for more efficient use of the energy. 

Electricity can also be generated from geothermal fluids of medium temperatures by using the heat to evaporate a working fluid, such as isopentane or an ammonia-water mixture that has different thermal properties than water.  This fluid runs in a closed loop within the power plant and is used to drive a turbine.  Low temperature liquids are commonly used for direct heat applications such as space heating, aquaculture, horticulture, industrial balneology and swimming pools, industry and snow melting. In many cases, the geothermal effluent is re-pumped into the tank from which it was extracted to increase the rate of recharge and to avoid possible negative effects of the discharge on the surface. Another large potential in geothermal is Hot Dry Rock or Enhanced Geothermal Systems, where energy is stored in dry non-porous rock.  Exploitation of this energy is more challenging than the more conventional hydrothermal exploitation, but research into such systems is in progress.  If these resources can be harnessed economically, they have the potential to vastly increase the use of geothermal energy worldwide and to make it accessible to people currently dealing with other, less environmentally friendly sources of energy.

In Portugal, there is a market gap for high enthalpy geothermal education. The project aims to change this situation. Taking into account the fulfilment of the EU and regional legislations and the overall objective of the Renewable Energy programme area of the EEA Grants, the project aims to improve the capacity on the utilization of geothermal energy by offering an opportunity for participation in Short Courses on exploration and exploitation of high enthalpy geothermal energy sources, given by the United Nations University Geothermal Training Programme, Iceland, to be held at the Azores Archipelago. Such cooperation between the donor and beneficiary states contributes to a closer relationship among Iceland and Azores, Portugal, as well as to the achievement of the EU 20-20-20 targets in the field of using renewable energy sources. The project contributes to improving skills of Azorean professionals to perform their duties and also to Azorean students gaining knowledge on geothermal energy. The courses also contribute to lifelong learning, which is absolutely necessary in such an innovative field as renewable energy technology.

The target groups of the capacity-raising and educational programmes have been set according to the relevant needs and demands in Azores. The call for applications was available for employees of the companies who were involved in industrial exploitation of geothermal resources with the appropriate knowledge in the field of geothermal energy utilization (for Pillars I and II), students with experience in geothermal energy utilization (just for Pillar I) and students from the Azores University involved in geothermal energy utilization (just for Pillar I}. The total amount for the small grant scheme on 0606 -Improved capacity at national, regional and local level for renewable energy solutions was E 402 000. The grant amount for $65 is defined in accordance with Article 5.6 of the Regulation. The total amount of the small grant scheme will be less than 20% of the eligible expenditure of the programme.

One of the aims of the Programme is to increase the scientific and technological capacity of the Azores in the field of geothermal energy. Under this objective, it supports participation in Short Courses on geothermal energy. The courses are lectured by the United Nations University Geothermal Training Programme (UNU-GTP), Iceland's Geothermal Energy Program. The UNU-GTP provides a series of 2-week short courses (6) in the Azores in the period 2014-2016. Through calls, were selected 2 students and 11 professionals from the Azores to participate in the courses. By collaborating, the partnership expects to enhance information sharing, capacity building and mutual learning, strengthen bilateral relations between Iceland and Azores, Portugal, contributing to lifelong learning, which is absolutely essential in such an innovative field such as geothermal energy technology.

The long-term goal of the project was to increase the capacity of the employees of the companies who are involved in industrial exploitation of geothermal resources, of students with experience in geothermal energy utilization and of students from the Azores University involved in geothermal energy utilization. In this way, it was assured that not only the knowledge gained by the participants can be directly implemented in their projects, but also that it was an investment that was used for the benefit of the region.

Individual sub-projects:

The Project included education Programme in United Nations University in Iceland. The Initiative for Pillar I, courses held in Ponta Delgada, Azores, was available for the employees of the companies related with the industrial exploitation of the geothermal resources, students with experience in geothermal energy utilization and students from the Azores University involved in geothermal energy utilization.

  • In this Pillar I, students with experience in geothermal energy utilization and students from the Azores University involved in geothermal energy utilization, after being selected, are invited to attend these courses.
  • The initiative for Pillars ll, courses held in Iceland, was available for the employees of the companies related to the industrial exploitation of the geothermal resources. In this Pillar ll, each selected candidate must pay 15% of the cost of participation / person to attend that course. The aim with this is to ensure that candidates will show willingness to attend such courses.


Educating the next generations is a key issue in terms of social inequalities and gender equality and hence the small grant scheme will focus on capacity building in companies exploiting geothermal resources for energy production by offering higher education programmes in geothermal energy, at the heart of the overall programme. Bilateral relations, as another important objective of the EEA FM, will be strengthened and encouraged between the Donor States and the Beneficiary States through higher education partnerships and donors.

The geothermal resources of Azores and Iceland provide an excellent platform for exchanging know how and enhancing cooperation in this area both at programme and project level

The programme aims developing a strong bilateral cooperation with the donor states, in order to create a network of exchange, sharing and transferring knowledge, technology and experience in the field of geothermal energy solutions. The result focuses on strong bilateral cooperation with the donor states. These initiatives will encourage networking, exchange, sharing and transfer of knowledge, technology and experience to strengthen bilateral relations among the states, namely, between Iceland and Azores by supporting the participation of Azorean programmers in Icelandic training programs for geothermal energy. The funds for bilateral relations will also make an important contribution to bilateral relations, involving donor institutions and study visits to beneficiary and donor countries. Activities enhancing cooperation between organizations in Azores and Iceland and, also, promoting knowledge and understanding of EEA Grants.



Pic. 1: Geophysical Experience. Pic. 2: 1st Conference in Azores. Pic. 3: Terceira Azores Pic. 4: Training on Drilling Technology
©2020 RES-eeagrants. All Rights Reserved.

Developed by DIADIKASIA