Distr.
RESTRICTED
FCCC/IDR.1/POR
4 December 1996
ENGLISH ONLY
PORTUGAL
Report on the in-depth review of the national communication of Portugal
Review team:
Leonidas Oswaldo Girardin, Argentina
María Angeles Cristobal López, Spain
Lucas Assunç o, UNFCCC secretariat, Coordinator
Also available on the World Wide Web (http://www.unfccc.de)
GE.96-
Summary
1. Portugal ratified the Convention on 21 December 1993 and submitted its first national
communication on 25 January 1995. The in-depth review was carried out during the period
August-November 1996 and included a visit to Lisbon from 9 to 12 September 1996. The
review team included experts from Argentina and Spain.
2. Portugal has fulfilled its reporting commitments under the Convention. It is also
committed to achieving the European Union (EU) target to stabilize carbon dioxide (CO2)
emissions at 1990 levels by 2000, even though Portugal's own national target is to limit
growth in CO2 emissions from fossil fuel combustion to 40 per cent in the decade. The
review of the country's policies relevant to the Framework Convention on Climate Change
cannot be undertaken without an understanding of the complex process of integration of the
Portuguese economy into the EU and the Government's commitment to raise living standards
towards the EU average. Since Portugal joined the EU in 1986, its economy has become
increasingly intertwined with the European economy as a whole. Its energy, transport and
industrial policies have been determined to a growing extent by main trends in the EU, with
decreasing scope for independent domestic policy-making.
3. During the review, a considerable amount of additional background information about
inventories, projections and policies and measures was made available in a transparent and
cooperative way. This new material greatly improved and updated information submitted
with the national communication. Of particular importance were the revisions made to CO2
projections for 2000, the estimate of the country's sink capacity and the submission of new
greenhouse inventories, primarily for CO2, for 1991 through 1994. Regarding CO2 sinks, the
estimation of annual CO2 uptake by Portuguese forests was considerably revised during the
review following the review team's suggestion that the Intergovernmental Panel on Climate
Change (IPCC) default methodology be applied. The annual removal of CO2 was thus
estimated at 29,718 Gg, rather than the 70,400 Gg reported in the national communication.
4. In light of the economic performance of Portugal in the first half of the 1990s and
assuming that the expected increase in the use of natural gas in electricity production takes
place as planned, total energy-related CO2 emissions in Portugal are now projected to grow by
34.5 per cent in the decade. This is a significant downward revision of the 40 per cent
projected in the national communication. The team strongly urged government officials to
prepare emission projections for CO2 from other sources also, and for methane (CH4) and
nitrous oxide (N2O).
5. The team noted that no effort has so far been made to estimate the possible mitigation
effects of ongoing policies and measures, even though some measures being implemented
could be considered "no regrets" measures. The review team strongly recommended that such
an effort be made for the second national communication due in April 1997, in particular in
the energy, transport and industry sectors.
6. The energy system in Portugal has undergone major restructuring to meet increasing
energy demand and increased dynamics in EU energy markets. Former policy objectives such
as energy security and energy supply diversification are giving way to EU-wide energy supply
and demand forces and becoming less dependent on strictly national circumstances. Energy
demand is expected to keep growing at an annual rate of 4 to 5 per cent, but national per
capita consumption remains lower than the EU average. The introduction of natural gas in
total primary energy supply in early 1997 -- with the entering into operation of the Algerian
gas pipeline through Spain -- is expected to meet part of this energy demand growth, both for
electricity supply and for industrial and residential end-uses. The country's dependence on
imported oil is expected to decrease from the current 70 to 60 per cent of its needs by 2010.
There is no nuclear power generation in Portugal.
7. An unprecedented road-building process has been under way for the last 10 years. The
transport sector has grown much faster than gross domestic product, while the population has
remained stable. This trend is expected to continue as consumption patterns approach those
of the EU. The EU average car ownership rate per inhabitant has not yet been attained. The
team was informed that bottlenecks to this expansion could occur in the near future as city
and nation-wide road infrastructures are not always available. Emissions in the transport
sector are expected to increase 46 per cent by 2000 and 78 per cent by 2010, while in
electricity production they may grow by 35 per cent by 2000, even when the increased share
of natural gas is factored in.
8. Other important measures which may impact on CO2 emissions from the energy sector
include incentives for independent producers (i.e. small hydropower producers and other
renewable sources) to generate electricity, which must be purchased by the recently
restructured Eletricidade de Portugal. Programmes have provided direct capital investment
grants and loans in the past, mainly to industry, while a more recent programme has been
designed to provide financial incentives to the industry, transport and building sectors.
Fiscal incentives are in place for the installation of new equipment needed in the use of
renewable sources of energy for domestic consumers. Regulations related to energy
management, building insulation, building acclimatization systems and equipment labelling
and standards are part of the government's energy efficiency policy and likely to also limit
CO2 emissions. During the review, government officials stated that the introduction of
demand-side management measures and integrated resource planning are under discussion in
connection with future energy policies. The possible mitigation effects and timing for
implementation of these measures were not specified.
9. Portugal, as a participant in the Global Environment Facility (GEF), made a contribution
in 1994 to the GEF pilot phase of 4.5 million SDR (special drawing rights), or roughly US$
6.5 million. Portugal considers its bilateral cooperation with Portuguese-speaking African
countries as a priority in its commitment to implement Agenda 21. Regarding climate
change, the Ministry of Foreign Affairs has approached Cape Verde and Guinea-Bissau to
promote their active participation in the GEF, and similar contacts have been made with
Angola and Mozambique. A decision has also been taken by the group of Portuguese-
speaking countries to create an agency for the assessment of environmental impact. Such an
agency would include Portugal, Brazil, all Portuguese-speaking African countries and the
Territory of Macau. Several projects have already been identified in the areas of greenhouse
gas (GHG) inventories, air pollution monitoring, climate observation and adaptation measures
and dissemination of technical information.
I. INTRODUCTION AND NATIONAL CIRCUMSTANCES
10. Portugal ratified the Convention on 21 December 1993 and submitted its first national
communication on 25 January 1995. The in-depth review was carried out during the period
August-November 1996 and included a visit to Lisbon from 9 to 12 September 1996. The
review team met officials from more than ten ministries, representatives from the academic
community whose work is relevant to Portugal's implementation of the Convention, and
representatives from several environmental non-governmental organizations, which all
provided a wealth of additional background information. The review team was composed of
Mr. Leonidas Oswaldo Girardin (Argentina), Ms. María Angeles Cristobal López (Spain) and
Mr. Lucas Assunç o (UNFCCC secretariat, Coordinator).
11. Since Portugal joined the European Union (EU) in 1986, its economy has become
increasingly intertwined with the European economy as a whole. Its energy, transport and
industrial policies have been determined to a growing extent by main trends in the EU, with
decreasing scope for independent domestic policy-making. The review of the country's
policies relevant to the Framework Convention on Climate Change cannot be undertaken
without an understanding of the complex process of integration of the Portuguese economy in
the EU and the Government's commitment to raise living standards towards the EU average.
12. Portugal has 3 per cent of the EU population, 3 per cent of its territory but only 1.5 per
cent of the gross domestic product (GDP) of the EU as a whole. Eighty per cent of its
territory contains only 20 per cent of the population, the remaining population being
concentrated on the coast, mainly in the larger cities of Lisbon and Porto. Population has
stabilized since the late 1980s at roughly 10 million inhabitants.
13. Although national consumption patterns have moved steadily closer to those of EU
countries in general, GDP per capita still amounts to only 70 per cent of the EU average of
US$ 10,000. It is worth mentioning, on the other hand, that owing to its cultural and climatic
conditions the country does not expect to reach the same level of per capita energy
consumption as in other European countries.
14. Some of the factors conditioning this convergence process are (a) the integration of
Portuguese firms into a EU-wide free market, where market forces prevail over national
sovereign isolated policies; (b) the compulsory alignment with EU policies in specific sectors
such as agriculture and environment; and (c) the availability of EU structural funds which
have provided Portugal with incentives in a few sectors such as transport, energy and
environmental management and legislation. The expected EU monetary integration is
perceived as providing new business opportunities, as well as new challenges for the
Portuguese economy.
15. Although major structural changes are not taking place in the industrial sector, there are
signs of a broadening of the base of industrial production. Increased access to the EU
markets has not as yet led to greater diversification of export products but rather to
concentration on traditional products, such as textiles, clothing, wood, paper and cork.
Despite the low rate of economic growth that has prevailed since 1991, some industries such
as the chemical, petrochemical and automotive industries have gone through rapid change,
with increasing dependence on high technology.
16. The energy system in Portugal has undergone major restructuring to meet increasing
energy demand and increased dynamics in energy markets, particularly in the EU. Policy
objectives such as energy security and energy supply diversification are now considered as
being better achieved within the EU-wide energy market and less dependent on strictly
national circumstances. Portugal's high dependence on oil is increasingly perceived as a
Union-wide concern rather than an exclusively domestic problem. There is no nuclear power
generation in the country, although no formal declaration or commitment against its use has
been made. Since all decisions regarding energy policies now have to be submitted to cost-
benefit assessments at the EU level, there has been no discussion about building national
nuclear plants.
17. Energy demand is expected to keep growing at an annual rate of 4 to 5 per cent, but
national per capita consumption is expected to remain lower than the EU average. The
introduction of natural gas in total primary energy supply (TPES) is expected to meet part of
this energy demand growth, both for electricity supply and for industrial and residential end-
uses. Natural gas is not used at all in the country at present. It is expected to be introduced
as a major energy carrier in early 1997 with the entering into operation of the Algerian gas
pipeline through Spain. According to estimates, it will account for 8 per cent of TPES in
2000 and 15 per cent in 2010-2015. Energy demand forecasts contained in the national
communication tend to over-estimate actual trends when compared to most recent forecasts.
This has been the case in several sectors except in the transport sector where actual energy
demand has exceeded forecasts. The country's dependence on imported oil is expected to
decrease from the current 70 to 60 per cent of its needs by 2010, even though some fuel
switching from oil to natural gas is expected after 1997. A new 900 MW combined cycle
(natural gas) power plant to produce electricity is under construction in northern Portugal and
is planned to come into operation by early 1998.
18. The agricultural sector has also been greatly affected by integration with the EU. It
now accounts for only 6 per cent of GDP and involves 10 per cent of the active population,
while 30 years ago it accounted for 20 per cent of GDP and employed 30 per cent of the
population.
19. An unprecedented road-building process has been under way for the last 10 years. The
transport sector has grown much faster than GDP, while population has remained stable. This
trend is expected to continue as consumption patterns approach those of the EU. The EU
average rate of car ownership per inhabitant has not yet been attained. During the review, the
team was informed that bottlenecks to this expansion could occur in the near future as city
and nation-wide road infrastructures are not always available.
20. The gradual phasing-out of the monopoly exercised by the public company Eletricidade
de Portugal (EDP) in the electricity production sector may well have important effects on the
demand for fossil fuel-based electricity, as well as on operating costs of the energy production
sector in the country. The recent restructuring of the electricity system allows for the direct
access of end-users to independent producers. In the case of natural gas, transportation is
clearly separated from distribution and four new distribution companies have already been
established.
II. INVENTORIES OF ANTHROPOGENIC EMISSIONS AND REMOVALS
21. The national greenhouse gas (GHG) inventories were prepared for 1990 drawing mostly
on the CORINAIR methodology. They were later converted to the Intergovernmental Panel
on Climate Change (IPCC) reporting format by employing the CORINAIR/IPCC interface
methodology developed by CITEPA. National inventories were submitted for carbon
dioxide (CO2), methane (CH4 ), nitrous oxide (N2O), non-methane volatile organic compounds
(NMVOC), nitrogen oxides (NOx) and carbon monoxide (CO). Most emission factors used
in estimations were either CORINAIR default values or factors referenced in the international
literature, so they did not always reflect specific Portuguese conditions. For some categories
of activity such as enteric fermentation and use of fertilizers in agriculture, emission levels
were estimated using the proposed IPCC methodology, which was considered to be more
appropriate than CORINAIR.
22. In accordance with the IPCC methodology, emissions resulting from biomass burning
for fuel were reported separately and not added to total emissions from fuel combustion;
emissions from international bunker fuels (for both maritime and air transport) were reported
separately; and the carbon content of CH4, CO and NMVOC emissions during fuel
combustion was converted to CO2 and added to CO2 emission totals. The national
communication included the required IPCC minimum tables containing activity levels and
aggregate emission factors, which greatly enhances the comparability of inventories. It also
included qualitative estimates of confidence levels for each broad source category.
23. There has been no estimation of GHG emissions originating from agricultural waste
burning or land-use change, because of the lack of national activity data. Regarding CO2
sinks, however, the estimate of annual CO2 uptake by Portuguese forests was greatly revised
during the review following the review team's suggestion that the IPCC default methodology
be applied. The annual removal of CO2 was thus estimated at 29,718 Gg, rather than the
70,400 Gg reported in the national communication. Although the revised figures seemed
more plausible, it would be advisable to improve the estimation procedures and increase
knowledge of specific national conditions with a view to reducing the high uncertainty level
associated with the estimation of sink capacity in Portugal.
24. In the 1990 inventory, CO2 emissions from fuel combustion represented 92 per cent of
the total of 42,148 Gg, with the remainder originating from industrial processes. The largest
emission sources are the energy production and transformation and transport sectors,
responsible for 50 and 26 per cent of total energy-related CO2, respectively. The reported
total of 38,700 Gg of CO2 emissions from fuel combustion in 1990 is 3 per cent lower than
the total energy-related CO2 emissions estimated by EUROSTAT (39,800 Gg) and 6 per cent
lower than estimates made by the International Energy Agency (41,000 Gg). Regarding CH4,
total emissions amounted to 5,554 Gg -- in CO2 equivalent, using 1994 IPCC global warning
potential (GWP) values -- with 78 per cent of emissions originating in 1990 from enteric
fermentation, animal wastes and rice cultivation and 16 per cent from waste treatment. Total
N2O emissions were 3,392 Gg (in CO2 equivalent) in 1990, 47 per cent arising from fuel
combustion and 34 per cent from the use of fertilizers in agriculture. Using 1994 IPCC GWP
values for a 100-year horizon, CO2 represented 83 per cent of greenhouse gases in Portugal,
while CH4 and N2O represented 11 and 6 per cent, respectively.
25. With respect to hydrofluorocarbon (HFC) and perfluorocarbon (PFC) emissions, the
Portuguese officials did not include their emission levels in the first communication owing to
methodological issues, but are committed to doing so in the next one, especially after the
confirmation that there is aluminium smelting in the country. The team was informed,
however, that there is no production of magnesium in Portugal.
26. During the country visit, the Government submitted new inventories for 1991 through
1994 for the broad emission source categories for all the gases reported in the first national
communication. These new inventories include new data for fuel combustion only and
partially for the industrial processes category. Emissions from other broad source categories,
i.e. solvent use, agriculture, land-use change, forestry and waste, have not been estimated for
years other than 1990. For CO2, the new inventories show a sharp 18 per cent increase in
emissions from 1990 to 1992 and a decrease thereafter to a 1994 level which is 9.6 per cent
higher than in 1990. This emission pattern could be explained by both the climatic
fluctuations and variations in economic activity level. An assessment of the evolution in CH4
and N2O emissions has not been possible since estimates for the major source categories of
these gases were not provided in the new inventories.
27. The review team recommended that more information be provided on activity data and
emission factors used for each source category at a level of detail to permit reconstruction of
the inventories. In this respect, it would be useful to make available the CORINAIR
inventory for those source categories where that methodology has been used. It would also
be useful to have a better knowledge of emissions arising from land-use change and forestry
in Portugal.
III. POLICIES AND MEASURES
28. So far, Portugal has not implemented any mitigation measures as such, although during
discussions with individual ministries the team noted that there are measures in place which
could be described as "no regrets" measures, even if they were not explicitly introduced in
response to climate change concerns. On the other hand, Portugal does not seem to be under
any pressure to introduce specific mitigation measures because of the flexibility clause it was
granted in the EU target to stabilize CO2 emissions at 1990 levels by 2000.
A. Energy
29. In 1990, the energy production and transformation sector was the largest source of CO2
emissions in Portugal, accounting for 50 per cent of fuel combustion emissions and 46 per
cent of total CO2 emissions. Bearing in mind the sustained growth in energy demand in recent
years and economic prospects for future decades, the sector is likely to remain a major source
of these emissions. The evolution of CO2 emission trends in Portugal will largely depend on
measures introduced in relation to efficiency in energy use and the country's energy supply
structure.
30. The explicit objective of the national energy policy is energy security, reduction of
energy intensity per unit of GDP, enhanced market competition and respect for the
environment. Increased dependence on energy imports is to be avoided by the diversification
of supply sources, intensified efforts to employ national energy resources, efficiency
improvements in national energy supply systems and equipment upgrading.
31. Portugal's energy sector is relatively small compared with other European economies.
Total energy demand in 1990 was 12.7 million tonnes of oil equivalent (toe), roughly 1.5 per
cent of the EU total. Additionally, Portugal has a relatively low per capita energy
consumption, the total final consumption per capita being 1.3 toe while the EU and OECD
averages are 2.5 and 3.4 toe per person, respectively. The ratio of energy-related CO2
emissions per capita is the lowest in the EU, 4.5 tonnes compared to an average of 9 in the
EU and 12 tonnes in OECD countries as a whole. On the other hand, the country's level of
energy-related CO2 emissions per unit of GDP was in 1990 considerably higher than both the
EU and OECD averages, 1.54 tonnes compared to 0.97 and 1.01 tonnes, respectively. This
last indicator reveals the country's relatively lower stage of economic development compared
to other EU and OECD partners.
32. Portugal is dependent on energy imports for roughly 90 per cent of its needs; it has to
import all its consumption of oil, virtually all coal after national coal mines were closed in
1995 and, in the near future, all its consumption of natural gas. Indigenous energy resources
such as hydropower (the potential of which is almost fully exploited) and other renewable
sources including biomass account for the remaining 10 per cent of TPES. There is no
nuclear power generation and co-generation still plays only a limited role in total energy
supply.
33. As far as electric power production is concerned, in 1994 thermal generation accounted
for 66 per cent and hydropower for the remaining 34 per cent. These shares tend to vary
considerably according to, inter alia, the varying rainfall levels in different years (i.e.
hydropower made up 10 per cent of TPES in 1979, 5 per cent in 1991 and it may be 4 per
cent in 2000). Historically, electricity prices have been relatively higher than in other EU
countries. With a view to increasing competition in electricity supply, the Government in
1991 initiated the restructuring of the national electricity system and in 1994 the national
electricity company, Eletricidade de Portugal (EDP), separated its generation, transport and
distribution functions. This latter process is being concluded. The government is now
preparing the privatization of the holding electricity company.
34. Oil represents roughly 70 per cent of TPES, with the transport and service sectors
taking an increasing share in total (oil) consumption at the expense of the industrial and
residential sectors. This dependence on oil is expected to fall but only to 61 per cent in 2000.
Coal's share in TPES was roughly 17 per cent in 1990, from 5 per cent in 1979, and it is
projected to reach 18 per cent in 2000 and 15 per cent in 2010. Biomass accounted for 7 per
cent of TPES in 1990 and is expected to decrease slightly to 5 per cent by the end of this
decade.
35. The most significant development in the energy sector in Portugal, with very important
effects on its CO2 emission profile, will be the introduction of natural gas in early 1997. With
the entering into operation of the Maghreb pipeline from Algeria through Spain, Portugal
expects to reduce its dependence on imported oil and coal. The increasing use of natural gas
will not only improve energy diversification, but should also substantially reduce the growth
in CO2 emissions. Natural gas is expected to account for over 8 per cent of TPES in 2000,
which implies a fast penetration of natural gas, since it will be used for electricity generation
in a new combined cycle gas turbine (CCGT) in Tapada do Outeiro. At the same time,
natural gas will gradually be introduced in the industry and residential sectors. The existing
power plant in Carregado will be converted to a dual-fired natural gas and fuel oil power
plant. During the review, the team was informed that most connections in the high-pressure
gas network have been made. The distribution networks still need completing. Government
officials informed the team during the review that natural gas may represent 13 per cent of
TPES in 2010 and 15 per cent by 2015, which would reflect a major fuel switch from oil and
coal.
36. Other important measures which may impact on CO2 emissions from the energy sector
include incentives for independent producers (i.e. small hydropower producers and other
renewable sources) to generate electricity, which must be purchased by Eletricidade de
Portugal (EDP). The SIURE and VALOREN programmes have provided direct capital
investment grants and loans in the past, mainly to industry, while more recently the SIURE
programme has been revised to provide financial incentives to the industry, transport and
building sectors. Fiscal incentives are in place for the installation of new equipment needed
in the use of renewable sources of energy for domestic consumers. Regulations related to
energy management (RGCE), building insulation (RCCTE), building acclimatization systems
(RQSCE) and equipment labelling and standards are part of the government's energy
efficiency policy and likely to also limit CO2 emissions. During the review, government
officials stated that the introduction of demand-side management (DSM) measures and
integrated resource planning are under discussion in connection with future energy policies.
The possible mitigation effects and timing for implementation of these measures were not
specified.
37. It would be desirable to establish a monitoring mechanism on the effects of ongoing
and planned measures in the energy sector, in view of their relevance to the implementation
of the Convention in Portugal. This would necessarily require closer and continuing
cooperation among the ministries concerned. Improved monitoring would, for example,
contribute to a better understanding of how an announced 5 per cent increase in energy
efficiency in the industrial sector as a whole would be achieved by 1999. It would also be
instrumental in showing that some current measures are indeed "no regrets" measures with
clear mitigation and economic benefits.
B. Industry
38. In 1990, the industrial sector accounted for 16 per cent of CO2 emissions associated
with fuel combustion and 14 per cent of total CO2 emissions, making it the second largest
CO2 emission source in Portugal. Although the sector's share in total energy consumption
remained practically stable in the 1980s and declined slightly in the early 1990s, all
projections point to an increase in energy needs in industry in conjunction with the process of
economic opening and integration with the EU.
39. Industry accounted for 24 per cent of GDP in 1990, even though it is rather
concentrated in a few centres and highly dependent on energy imports and foreign
technologies. Its main sectors are textiles, transport equipment, chemicals, food products and
beverages, paper and cork, which together account for 76 per cent of the industrial value-
added and 74 per cent of employment in industry. The process of integration with the EU is
likely to have an impact on some sectors, possibly leading to a greater degree of
specialization as a consequence of the increased competition from other EU suppliers.
40. Although the team was not informed of any policies to foster specific industrial sectors,
the broad objectives of industrial development in the country have been to sharpen
international competitiveness and create employment. There is an expectation that the process
of integration with the EU will generate changes within and between industrial sectors in
Portugal, for example as seems to be occurring in the chemical, petrochemical and traditional
pharmaceutical sectors. Very little information was made available in this regard, although
during the review there was some mention of recent developments in the car (and car parts)
industry in Portugal.
41. There is a clear concern about keeping pace and being in harmony with EU policies, as
Portugal remains highly dependent on foreign investments from EU and OECD partners.
Since industrial, social and environmental regulations have a direct impact on the
competitiveness of firms in particular and on the national economy as a whole, there cannot
be major discrepancies between regulations adopted by Portugal and its major trade partners.
42. An important initiative to promote the incorporation of environmental concerns into
industrial decisions is taking place through the second phase of the Specific Development
Programme for Portuguese Industry, 1994-1999 (PEDIP II). During the review it was reported
that for 1996 US$ 56 million were made available for eligible industrial firms interested in
adopting environmentally sounder technologies. No information was provided on the effects
of the programme.
43. The team noted that gains in energy efficiency could reduce the sector's dependence on
energy imports, while also reducing growth in GHG emissions. During the review, however,
it seemed that measures to improve energy efficiency in the sector came solely under the
responsibility of the General Directorate of Energy which is now part of the Ministry of
Economic Affairs. Only limited information was made available on promising measures such
as the Incentive System for the Rational Use of Energy (SIURE), which aims at supporting
energy efficiency projects in all non-domestic energy end-use sectors. It would be useful if
more information could be provided on the progress and effects of these actions.
44. As in the case of the energy sector, some sort of mechanism for monitoring of
developments in different industrial sectors would be recommendable, including an
assessment of policies and measures currently in place. The team noted that no measures
have been introduced with the explicit objective of limiting the growth of or reducing GHG
emissions in Portuguese industry. It recommended that, as a minimum, data on current and
future energy consumption in different industrial sectors be disaggregated. This would greatly
improve knowledge about which sectors are expected to grow and whether growth in
industrial activity and energy consumption is accompanied by gains in efficiency.
C. Agriculture and Forestry
45. In 1990 the agricultural sector was responsible for 78 per cent of methane emissions, of
which 46 per cent was due to enteric fermentation, 26 per cent to animal wastes and 6 per
cent to rice cultivation. The sector accounted in 1990 for 6 per cent of GDP and 20 per cent
of the labour force. It occupied 45 per cent of the national continental territory, a further 36
per cent of which is covered with forests.
46. Portugal's agricultural policy is largely determined by EU policy, which aims to reduce
incentives to the sector. Consequently, any sectoral measures are highly conditioned by what
has been decided for the EU as a whole, including the management of traditional agricultural
systems and restrictions on the use of fertilizers and pesticides.
47. The team was informed that no major changes are expected in coming years regarding
the area under rice cultivation (currently 320,000 ha) and the national cattle stock. Based on
this assumption and the fact that no measures to reduce methane emissions from the
agricultural sector have been introduced, the Government does not expect any changes in CH4
emission trends from the sector.
48. Total forest area in Portugal amounts to 3.85 million ha, of which 78 per cent is
privately owned, 12 per cent is owned by municipalities and the remainder by the State and
workers' associations. It has been estimated that the country has a potential forest area of
5.28 million ha. The measures in place in the forest sector aim at managing, expanding and
conserving national forests. The Forest Plan 1994/1999 foresees an increase of 200,000 ha in
the forest cover and further improvements in another 150,000 ha. The team was informed of
plans for the creation of a permanent fund to support measures aimed at improving,
expanding and protecting national forests and to finance reforestation after forest fires. No
information was provided as to when the fund would come into being.
49. The team was informed that, owing to variations in market prices, there is a trend in
Portugal today to plant forests in areas with lower agricultural potential and to use fast-
growing species instead of the slow-growing ones planted in the past. On the other hand, the
team was also informed that the lack of technical and financial resources has undermined
existing incentives for afforestation, as well as the harmonization of national forest inventories
and the national forest plan. It would be useful if the second communication could describe
the progress made under the forest plan, its effects in terms of increased sink capacity and the
emission or removals projections for 2000.
D. Transport
50. In 1990 the sector, as the second largest source of greenhouse gases after energy
production, was responsible for one fifth of total CO2 emissions in the country. Emissions
from the sector have increased consistently every year since 1990, reaching a growth rate of
34 per cent in 1994 compared to 1990. The share of transport in total final energy
consumption is expected to increase from 29 per cent in 1990 to over 35 per cent in 2000.
The sector's consumption of petroleum products is expected to almost double in the decade
and grow by a further 84 per cent by 2010, by which time the sector could account for 50 per
cent of total final energy consumption in Portugal.
51. In recent years, the transport sector has undergone a major transformation. The growth
in total traffic in the 1980s and 1990s, measured in terms of the number of vehicles
multiplied by the number of kilometres travelled has been twice as rapid as the growth in
GDP. There has also been an unprecedented expansion in road infrastructure in the last 10
years. For example, from 1990 to 1994, the total length of motorway increased from 318 to
587 km, an 84 per cent increase! In the same period, the number of registered private cars
increased by 37 per cent, although the car ownership rate (337 cars per 1000 inhabitants)
remains lower than the EU average.
52. Roughly 98 per cent of domestic transport is done by road while the railway system
accounts for only 2 per cent. Most of the road-building currently under way consists of first-
time roads, rather than the renovation or duplication of existing ones. Tolls are charged on
all national motorways and a strict 120 km per hour speed limit has been applied for some
years. Car purchase taxes and fuel consumption taxes are among the highest in the EU and
have been a prime source of government revenue.
53. No GHG emission mitigation measures have been introduced specifically for climate
change or air pollution reasons. However, some measures currently under implementation
should certainly reduce the growth in GHG emissions. Possible mitigation effects of these
measures have not been estimated, either in the national communication or in the in-depth
review. Examples of these measures are: (a) periodic vehicle pollution inspections, by
which every truck must be inspected annually and every six months after seven years of use;
and testing of private cars every two years for cars more than four years old, to control
emission levels of major pollutants, check catalytic converters and ensure compliance with
EU standards; (b) expansion of Lisbon's subway and suburban surface light rail systems; (c)
improvement of urban traffic flow, including improved access to motorways and secondary
roads in major cities, a new bridge over river Tagus (Lisbon) and the expansion of the 25
April Bridge in Lisbon to ease commuting in the city; (d) fiscal and financial incentives by
the central government for the purchase of more efficient heavy goods vehicles; (e)
construction of a multimodal station in Lisbon by 1998 and Porto subway by 2000; and (f) an
incentive scheme to promote transportation of goods by specialized companies.
E. Waste
54. This sector accounted for 16 per cent of CH4 emissions in 1990, counting only
emissions from managed landfills and wastewater streams under treatment. According to the
National Waste Plan of July 1995, urban waste production has increased very fast in recent
years and is expected to sustain such growth in the coming years. While in 1994 Portugal
had a per capita average of 0.96 kg of waste per day, in 2000 this average is expected to be
1.1 kg per day as a result of increased consumption levels.
55. The management of urban waste, including collection, transportation and disposal or
recycling, comes under the responsibility of each municipality. Currently in Portugal there
exist 12 managed landfills, 307 unmanaged open dumps and 2 composting plants. The
National Waste Plan foresees the phasing out or management of all open dumps, as well as
the recovery of CH4 from some landfills for energy purposes. It also includes the
construction of incinerators for urban waste in Lisbon and Porto and an incinerator for
industrial wastes.
56. There are no estimates of GHG emissions in the sector for years other than 1990. The
team was informed that there are plans to start monitoring such emissions more closely after
the establishment of an official body, the Waste Treatment Institute in the Ministry of the
Environment.
F. Land-use planning
57. The executive functions of government in Portugal are exerted through the central
government and local authorities, with no administrative power at the regional level. The
central government is in charge of land-use planning at the regional level. Several plans have
been approved for high priority zones where uncontrolled urban growth has threatened
regional natural resources or hindered the promotion of sounder and more sustainable urban
development. At the municipal level, "guiding plans" are established to regulate specific local
urbanization plans, including building standards, infrastructure plans for local industrial
centres and rehabilitation of historical sites. The team noted that these municipal development
plans do not include as an objective the promotion of energy efficiency for new and old
buildings, neither do they establish building efficiency standards. Much potential exists for
efficiency gains in the residential sector in Portugal, in particular through the enforcement of
the recent regulations introduced for insulation standards in new buildings.
IV. PROJECTIONS AND EFFECTS OF POLICIES AND MEASURES
58. A considerable amount of new background information was provided during the review
which greatly clarified how emission projections were made, including the methodologies
used and assumptions made. All projections were made using a bottom-up approach, with
assumptions made for developments in each sector and specific scenarios for GDP and
population growth. Assumptions made were considered plausible and realistic by the review
team. Portugal has provided projections for CO2 emissions related only to fuel combustion,
because of technical constraints and the lack of basic activity data on the other sectors. The
team strongly urged government officials to prepare emission projections for CO2 from other
sources also, and for CH4 and N2O.
59. Mitigation effects of ongoing measures have not been estimated and were not
incorporated in projections of energy-related CO2 emissions for the 1990-1995 and 1995-2000
periods. The only exception has been the attempt to include the impact on energy-related CO2
emissions of the increase in the share of natural gas in total primary energy supply expected
from 1997 onwards. In preparing the second communication, it would be desirable to
incorporate rough estimates of the possible effects of some ongoing "no regrets" measures,
even though they are not described as mitigation measures by Portugal.
60. During the review, total energy-related CO2 emissions projected for 2000 were revised
to include the latest data on actual growth in GDP from 1991 through 1995, and to allow for
the expectation of lower economic growth in the second half of the decade as a result of
slower growth in the EU economy. Actual annual GDP growth from 1990 to 1995 averaged
1.3 per cent, instead of the 1.8 per cent originally expected. Accordingly, the new energy-
related CO2 emission projection for the period 1996-2000 has been adjusted and now shows
an average annual growth rate in GDP of 3.7 per cent instead of the original 4.9 per cent
assumed in the communication. These new projections indicate that energy-related CO2
emissions may now grow by 34.5 per cent over the decade, instead of the 40 per cent growth
originally expected. In view of the 40 per cent growth limit for CO2 emissions agreed with
its EU partners, Portugal can claim that it is meeting its commitments towards the EU
stabilization target, even though, domestically, stabilization of CO2 emissions is not in sight.
61. Together with this new updating of projections, prepared by the General Directorate of
Energy, new projections were also submitted for energy-related CO2 emissions in 2005 and
2010, including the breakdown of CO2 emissions from the energy sector by type of fuel and
by end-use sub-sector. These submissions include the new assumptions for GDP and
population growth, the total of light passenger vehicles and vans in circulation and the
average distance travelled. The team noted that the national communication did not report in
sufficient detail on the methodology used to prepare CO2 emission projections and
recommended that such information be provided next time, including a description of the
three basic scenarios contained in the "Strategy for the Energy Sector 1995-2015", prepared
by the former Ministry of Industry and Energy, now incorporated in the Ministry of
Economic Affairs.
V. PROJECTED PROGRESS IN GREENHOUSE GAS MITIGATION
62. Based on the new inventories for 1991 through 1994 submitted during the review,
which provided new data for the fuel combustion and industrial processes categories, CO2
emissions show a sharp 18 per cent increase from 1990 to 1992 and a decrease thereafter to a
1994 level which is 9.6 per cent higher than in 1990. Part of these year-to-year fluctuations
is explained by the varying levels of precipitation, dry years such as 1992 entailing increased
oil-fired generation to replace hydropower. Another important determining factor is,
obviously, the varying level of economic activity in different sectors.
63. The new projections of CO2 emissions from the energy sector show that the sectors with
fastest growing emission levels are the power generation, road transport and residential and
services sectors. Emissions in the transport sector are expected to increase 46 per cent by
2000 and 78 per cent by 2010, while in electricity production they may grow by 35 per cent
by 2000, even when the increased share of natural gas is factored in. Even though total CO2
emissions are now expected to increase less (34.5 per cent) than the agreed growth limit of 40
per cent in the decade, GHG emissions in Portugal are increasing fast and could increase even
faster if natural gas does not make further inroads into the electricity and residential sectors
and road transport continues with its impressive growth trend.
VI. EXPECTED IMPACTS OF CLIMATE CHANGE
64. During the review, the Institute of Meteorology of the Ministry of the Environment
provided extensive information on climate observation in Portugal and possible impacts of
climate change in its territory. In the last 30 years, it has been observed that precipitation
levels have decreased in the spring and increased in the winter, particularly in northern
Portugal where most agricultural activity takes place. Portugal is particularly vulnerable to
desertification and drought in the southern and eastern regions of Alentejo, Algarve and Tras-
os-Montes. A series of studies and measures to enhance climate monitoring are in place,
although no adaptation measures as such have been reported.
65. A detailed study prepared by researchers of the Institute of Meteorology on possible
impacts of sea level rise on the Portuguese coast showed that Portugal may be subject to
severe adverse impacts, particularly on the southern coast and low-lying banks of some rivers,
such as the Tejo, Sado and Douro rivers. There is evidence that some aquifers in the Algarve
region have already been contaminated with sea water.
VII. FINANCIAL ASSISTANCE AND TECHNOLOGY TRANSFER
66. Portugal, as a participant in the Global Environment Facility (GEF), made a contribution
in 1994 to the GEF pilot phase of 4.5 million SDRs (special drawing rights), or roughly US$
6.5 million. It has also recently contributed 4 million SDRs to the GEF first phase.
67. Portugal considers its bilateral cooperation with Portuguese-speaking African countries
as a priority in its commitment to implement Agenda 21. Regarding climate change, the
International Cooperation Institute of the Ministry of Foreign Affairs considers the GEF as the
main financial instrument for the approval of bilateral cooperation projects. The Institute has
approached Cape Verde and Guinea-Bissau to promote their active participation in the GEF,
and has signalled with the possibility of assisting these non-Annex I Parties to UNFCCC in
the preparation of their national GHG inventories. Similar contacts have also been made with
Angola and Mozambique, although these two Parties have not yet joined the GEF.
68. During the review, the review team was informed of a decision by the group of
Portuguese-speaking countries to create an agency for the assessment of environmental impact
(CRIA). Such an agency would include Portugal, Brazil, all Portuguese-speaking African
countries and the Territory of Macau. Several projects have already been identified in the
areas of GHG inventories, air pollution monitoring, climate observation and adaptation
measures and dissemination of technical information.
69. The team noted with appreciation that total official development assistance (ODA),
which represented 0.25 per cent of GDP in 1989 and 1990, had risen to 0.31 per cent in 1991
and 0.36 per cent in 1992. In 1993, the share of ODA dropped to 0.29 per cent but, in 1994,
it was again brought back to the level of 0.35 per cent of GDP, just above the average of
0.30 per cent recorded by OECD Development Assistance Committee countries for that year.
VIII. RESEARCH AND SYSTEMATIC OBSERVATION
70. Through its Institute for the Promotion of Technology Development, the Ministry of
Science and Technology promotes activities related to the development and adaptation of
environmental technologies in the country and technology cooperation with international
programmes, primarily with EU partners. Three specific climate-related projects are currently
under way, focusing on combating forest fires, atmospheric environment (in conjunction with
the Institute of Meteorology) and on the atmospheric environment in coastal zones to
determine the correlation between gas emissions, transport of contaminants and effects.
71. Climate monitoring systems are well developed in Portugal. Over 30 synoptic stations
and 70 climatic stations have collected climate data since 1931. Very long-term series do
identify minor rises in temperature, even though the fact that most stations are located in
urban areas makes it difficult to discard a possible "urban heat island" effect. 1995 was the
hottest year to date in Portugal, in line with findings of the IPCC Second Assessment Report.
IX. EDUCATION, TRAINING AND PUBLIC AWARENESS
72. There has been increasing collaboration between the education and environment
ministries to promote environmental education, including the subject of climate change in
schools from elementary to the secondary levels. The Institute of Environmental Awareness
(IPAMB) of the Ministry of Environment carries out several training programmes related to
environmental management, sensitizes public opinion through awareness campaigns on local
environmental issues and has produced teaching material for more formal environmental
education. The team was informed during the review that other relevant activities are also
carried out by other ministries and highly recommended that such information be included in
the next national communication.
73. The main environmental problems in Portugal are water pollution and contamination
due to mismanagement in urban waste disposal. Climate change is not yet perceived by the
public in general as a major environmental problem. The review team, however, had the
opportunity to meet with national non-governmental organizations which are actively engaged
in promoting a national sustainable development strategy to influence government policies, in
particular with respect to transport. These organizations seemed to be also pursuing the
adoption by the Government of integrated resource planning in the energy sector, as well as
the promotion of renewable sources of energy. In a joint meeting with government officials it
was agreed that non-governmental organizations will be given the opportunity to comment on
the second national communication before it is officially submitted.
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