Alcoutim to host biggest ever solar plant in Portugal

12 November 2014

The Algarve is to host a €220 million investment in solar energy, "the largest ever in Portugal" according to media reports and the rural council of Alcoutim is the chosen location.

The Portuguese Environment Agency has received an application for the licencing of the photovoltaic plant which will produce 200 megawatts from thousands of panels on an 800 hectare site.

To put this project into perspective, currently Portugal has 346 megawatts of installed photovoltaic power, of which 156 megawatts come from thousands of units of micro and mini-production.

The remaining 190 megawatts comes from larger scale projects.

The largest projects are unsurprisingly in the south of the country with the Amareleja site, near Moura in the Alentejo completed in late 2008, being the largest photovoltaic project to date.

Owned by the Spanish company Acciona, Amareleja produces 46 megawatts of power.

The new Alcoutim site near the Vale do Guadiana National Park will produce four times this amount and is another step forward in reducing Portugal's dependence on fossil fuels.

One of the Alcoutim project partners is the French company Soitec, also the energy supplier Enovos based in Luxembourg.

Enovos Luxembourg is wholly owned by Enovos International, a holding company with its registered office in Luxembourg and which acts as an umbrella for the network manager Creos Luxembourg S.A.

Then there is the Calouste Gulbenkian Foundation which joins the electrical contracting firm Electricidade Industrial Portugesa and project developer Luz.On, founded by EDP's former head of finance Rui Horta e Costa.

However there may be a problem as the energy supplied at this new photovoltaic farm could be for export only.

In an interview with Bloomberg in 2012, Horta e Costa commented “What I’m interested in is not in supplying renewable energy to Portugal.” Northern nations such as Germany “are still incentivising the use of renewable energy with significant tariffs,” he said, intent on 'following the money' which would help Portugal's exports.

Enovos holds 34.09% of the capital of this pilot project. Soitec and Electricidade Industrial Portugesa each hold 19.99%. Luz.on, the project developer, has a 15% share, alongside Calouste Gulbenkian which holds 10.93% of the capital.

Soitec claims to be the world leader in generating and manufacturing revolutionary semiconductor materials for electronic and energy industries.

Interestingly, Portugal's Calouste Gulbenkian Foundation now is investing in alternative energy using the oil profits from wholly owned subsidiary Partex based in the tax-friendly Cayman Islands.

In Portugal, Partex (Iberia) S.A. participates in four off-shore oil exploration blocks in the Peniche basin holding 5% together with Petrogal (30%), Petrobrás (50%) and Repsol (15%) and in two offshore blocks in the Algarve basin, holding 10% together with Repsol (90%).

The Gulbenkian Foundation, through Partex, already has made investments outside its staple diet of oil and gas by buying a stake in a Luxembourg mutual fund which itself is investing in wind and solar projects and in mini-hydroelectric plants in Portugal, Spain, Italy and France.

Investor in the new photovoltaic plant, the Gulbenkian Foundation, owns 100% of the Partex Oil and Gas Group Companies with the Partex Chairman Artur Santos Silva, vice-chairman Eduardo Marçal Grilo, Managing Director António Costa e Silva and directors Emílio Rui Vilar and José Neves Adelino all sitting comfortably on the board of the Calouste Gulbenkian Foundation and able to guide the supposedly independently managed foundation along a business route which best suits the oil and gas company’s interests rather than that of the foundation.

The international background and legal set-up of the founding partners of the Alcoutim photovoltaic site will make it likely that zero profit will be declared and taxed in Portugal.