Experts doubt REN stake will cut Portugal power bills

Energy specialists told ECO that the Portuguese state’s return to REN, the company that runs the national energy grids, is unlikely by itself to reduce electricity prices for households or businesses, challenging Prime Minister Luís Montenegro’s claim that the move will affect bills over the medium to long term.

Nuno Ribeiro da Silva, former head of Endesa Portugal, said he does not expect a price effect simply because the state now holds 13.7% of REN’s capital. He argued that electricity transmission is only a small part of the final bill, while taxes, contracted power and network services weigh more heavily. A sector source with regulatory experience also told ECO that transmission accounts for about 4% to 5% of the consumer bill and said targeting that component first “has no logic at all”.

The same source said REN is not seen as a poorly managed company and rejected linking the government’s decision to the April 28, 2025 blackout, noting that the outage did not start in Portugal. Ribeiro da Silva added that tougher security criteria after the blackout have increased network costs, underlining the trade-off between resilience and lower tariffs.

Several figures cited by ECO said the more important issue is not ownership but how Portugal organizes its electricity system. Former energy secretary João Galamba argued that REN only invests what the government authorizes and only passes through revenues approved by ERSE, Portugal’s energy regulator, making the prime minister’s price argument hard to understand. Former EDP executive António Vidigal said the state’s move may have merit as a public-interest tool, but questioned whether it is the best solution.

Ribeiro da Silva, Galamba and Vidigal all pointed to the UK model, where system operation and planning were separated from grid ownership. They suggested Portugal should consider splitting strategic planning and system operation from REN’s infrastructure business, potentially giving the state more control over key functions with less public capital than buying a minority stake in the company.

Originally published at Eco.pt