Portugal

Country: Portugal

Document type: National Strategy

Title: Portugal National Hydrogen Strategy (EN-H₂) (Portuguese language)

(English language enabled of the Resolution of the Council of Ministers)

Released: July 2020

Summary Points:

• The Strategy sets several objectives for (green) hydrogen deployment by 2030, including:
  • 2-2.5 GW of installed electrolyser capacity
  • 10-15% hydrogen injection into natural gas networks
  • 2-5% hydrogen in the energy consumption of the industry sector
  • 1-5% hydrogen in the energy consumption of road transport
  • 1.5-2% hydrogen in final energy consumption
  • Creation of 50-100 hydrogen fuelling stations
• Implementation of the Strategy is in three phases:
  • Phase 1 2020-2023 – adopting the regulatory framework, reviewing/implementing investment support measures, small-medium projects approved, designing R&D incentives, starting the Sines industrial project
  • Phase II: 2024-2030 – strengthening the regulatory framework, enhancing support mechanisms with EU funds, varied scale projects implemented nationwide, implementing the large-scale Sines project (with a planned installed electrolyser capacity of at least 1 GW by 2030)
  • Phase III 2030-2050 – consolidating hydrogen as a decarbonisation instrument

• The Strategy is to be implemented based on several European and national support and funding strategies, including the EU ‘Next Generation’ budget program.

In July 2023, press reporting indicated that Portugal, in its updated draft National Energy and Climate Plan, had increased its target for electrolyser capacity to 5.5 GW, up from 2.5 GW. Solar capacity and onshore wind capacity targets are put at 21 GW and 10.4 GW respectively.

Funding Support

Portugal’s Recovery and Resilience Plan (including RePowerEU measures) includes an allocation of €255 million to support Portugal’s ambition to expand the production of renewable hydrogen and other renewable gases. This total appears comprised of the following amounts:

Recovery and Resilience Programme – €185 million

• First round – media reporting (August 2023) indicated €102 million allocated, 25 new projects, installed capacity of 106 megawatts (MW).
• Second round – €83 million allocation, applications received (as at time of above media reporting August 2023).

REPowerEU – €70 million

• Allocation of €70 million announced (August 2023) under REPowerEU. In July 2025, it was announced that 17 projects were approved to strengthen the national capacity for the production, storage and distribution of renewable hydrogen and other renewable gases, totaling €70 million.

Media reports indicated that in December 2023, the EC announced that it had authorised a €140 million Portuguese scheme to support the production of renewable hydrogen and biomethane. It is reported that the scheme, adopted by the Commission in March 2023 and amended in November 2023, will take form of a variable premium under a two-way contract for difference concluded for a duration of 10 years.  In May 2024, media reports indicated that the Government announced the launch of an auction for the centralised purchase of hydrogen and biomethane, €140 million.

In March 2024, the EC announced approval, under the State aid Temporary Crisis and Transition Framework, of a €350 million Portuguese scheme to support investments for the production of equipment necessary to foster the transition towards net-zero, including amongst other things for electrolyser manufacture. The scheme will take the form of direct grants.

In September 2024, the EC approved, under the State aid Temporary Crisis and Transition Framework, a €1 billion Portuguese scheme to support investments for the production of equipment necessary to foster the transition towards a net-zero economy. The measure will be open to companies producing relevant equipment, namely batteries, solar panels, wind turbines, heat-pumps, electrolysers, equipment for carbon capture usage and storage, as well as key components designed and primarily used as direct input for the production of such equipment or related critical raw materials necessary for their production. Under this measure, the aid will take the form of direct grants.

In February 2025, the European Investment Bank announced it had granted a €430 million loan for two projects, already in construction at Galp’s Sines Refinery and which represent a total investment of €650 million.

• The Biofuels unit will receive €250 million of financing and will produce low-carbon fuels.
• The renewable hydrogen production unit (100 MW) will receive €180 million in financing and will be capable of producing 15,000 tons of renewables-based hydrogen per annum. Both projects are planned to be operational in 2026.

H2MED Pipeline

In October 2022, it was reported that Spain, Portugal and France had agreed to build a sea-based pipeline (H2Med) to carry hydrogen and gas between Barcelona and Marseille.

In December 2022, it was further reported that the pipeline would be exclusively dedicated to green hydrogen, would cost around €2.5 billion, would have capacity to transport two million tonnes of hydrogen per annum, and should be completed by 2030. The report noted that the three countries would submit the project to the European Commission (EC) for declaration as a ’project of common interest’.

In January 2023, it was announced that, as part of a French-German declaration, the two countries would take the necessary steps on a European backbone for hydrogen transport across Europe, including the necessary national and transnational hydrogen infrastructures and, in particular, the extension and connection of existing and planned infrastructures, including extension of the H2Med pipeline to Germany in close cooperation with involved partners. 

In June 2024, agreements were signed or formalised to progress the European H2Med corridor – consisting of a connection between Celorico da Beira in Portugal and Zamora in Spain (CelZa – a 248-kilometre interconnection, 0.75 mtpa of hydrogen maximum capacity) and a maritime connection between Barcelona and Marseille (BarMar – a 455-kilometre sub-sea pipeline, 2 mtpa of hydrogen maximum capacity). Expectations were that the corridor would be completed by 2030.

In January 2025, the EC announced the allocation of almost €1.25 billion in grants from the Connecting Europe Facility (CEF) to 41 cross-border energy infrastructure projects, including:

• A total of approximately €35.6 million in grants awarded for H2Med project studies with €28.34 million supporting the BarMar project and €7.22 million the Celza project.
• A total of approximately €40.2 million for the first axes of the Spanish Hydrogen Backbone, including studies for underground storage related to the Spanish Hydrogen Backbone.

 

Reviewed: September 2025