Redes Energéticas Nacionais, the Portuguese Transmission System Operator for both electricity and natural gas, is investing in the integration of renewable energy
Redes Energéticas Nacionais (REN) has two main business areas: electricity transmission and natural gas transportation, storage and re-gasification. Both activities are developed under long-term concession contracts with the state.
Portugal is among the few countries in the European Union where a fully unbundled company manages both the national power and natural gas infrastructures. As the manager of these vital infrastructures, REN is focused on security of supply, operational efficiency, and providing a high-quality service.
Being part of the European club of Transmission System Operators (TSOs) of power and natural gas, REN is deeply involved in the construction of the European energy market, and proactively seeks to anticipate the future trends and challenges of the energy business.
At the national level, REN is fully aware of the vital importance of its activities to the welfare of Portuguese society. It is involved in numerous initiatives aimed at reducing the environmental impact of its activities, and at creating close and strong relationships with local communities across the country.
According to the ERP 2011 report, REN is among the top 10 Iberian companies concerning transparency and sustainability – a clear sign of the ever-growing involvement of the company with all its stakeholders, and the integration of sustainability concerns in its day-to-day business operations. One example of this is the constant updating of a diversified and accurate database concerning the Portuguese energy sector, which REN makes available to the public.
On the economic side, REN is characterised by a strong financial profile based upon a stable and predictable cash flow. REN is also one of the companies with the highest dividend yield among energy utilities.
Ready to grow, while innovating
The energy sector has been evolving rapidly. Recent trends include market liberalisation, diversification of energy sources, globalisation and quantified environmental commitments.
Well aware of these challenges, REN is starting to prospect international business opportunities, particularly in the Portuguese-speaking world.
One of the competencies that earns the company international recognition is the integration of energy from renewable sources. Portugal currently produces around half of its electricity from renewable energy sources. As a consequence REN developed strong competencies in the secure integration of renewable sources in the global energy system.
REN has been investing strongly in the quality and reliability of its infrastructures. The total length of circuit lines has increased by 32 percent in the last 10 years, and about 50 percent of pre-existing lines have been upgraded. All the older electricity substations were renovated through the replacement of their control systems and the increase of their level of automation and protection. The most recent example is the new Tavira substation (Algarve), which reinforces the existing interconnection capacity with Spain and increases the security of supply to the whole of southern Portugal.
From Portugal to the world
As renewable energy becomes increasingly important in the power industry, so too does natural gas – being the thermal technology of choice to keep the system balanced. Wind is an intermittent source and as such poses a challenge to the system operator: in the absence of wind, thermal plants have to be called into action to keep the balance.
As owner and operator of the natural gas infrastructures, REN takes full advantage of the synergies between power and gas infrastructures. At the same time as it ensures the smooth integration of new wind farms in the network, REN develops the appropriate natural gas infrastructures to ensure that sufficient backup thermal capacity is in place.
The upgrade of the liquified natural gas (LNG) terminal in Sines is the most emblematic project in recent years. With its increased capacity, the LNG terminal allows suppliers to bring LNG from anywhere in the world under more competitive conditions. This is a crucial element for traders and industrial consumers to take full advantage of the opportunities offered by the growing natural gas spot market.
Another important infrastructure is the underground saline storage of natural gas. Until 2016, the company plans to expand its current capacity, with the construction of five new cavities (increased capacity from 0.16 to 0.4 billion cubic metres).
Finally, a third interconnection with Spain is planned for the future. This will ensure the closing of a ring between the two countries, thus ensuring the improvement of the overall security of the Iberian system. Simultaneously, the removal of the current saturation of the existing interconnection will create the conditions for the development of the Iberian market of natural gas.
Research and development is one of REN’s priorities. The company is deeply involved in several projects at the European level and has a permanent interchange of knowledge with its peers around the world. Of particular importance is the sharing of best practices concerning power grids’ management and operation, including dealing with the unpredictability of renewable energy production (particularly wind), the use of hydroelectric pumping to accommodate surplus wind production, improving the performance of existing lines, reducing the environmental impact of overhead lines, and building smaller, quieter substations.
Every year REN awards a prize to the best pieces of research work in the fields of electricity and natural gas transportation, and it supports a significant number of other R&D initiatives.
The widespread support to social and cultural activities related to the values of sustainability and social development is also an important element in REN’s activity. The company particularly values its programmes aimed at protecting the natural environment, a good example of which is the reforestation programme, which follows the path of the overhead power lines and the gas pipelines. More than 470,000 trees will be planted and growing throughout the country by the end of 2012, thanks to this project.