Portugal's 2026 storage rules: what changes for battery projects

Portugal changed the rules for battery storage in 2026, and more changes are on the way. Decree-Law 130/2026 came into force on 28 August and changes how storage is licensed and connected. A first auction for 750 MVA of standalone storage grid capacity has been designed but postponed. A capacity mechanism open to batteries is being prepared, and REN is opening its reserve markets to batteries.

This report explains each change and what it means for standalone and business batteries. For what the market data says about battery revenue in Portugal, see our companion report, Portugal’s power prices in 2026.

Key points

• Permitting is easier. Storage is now presumed to be of overriding public interest, and prior-control procedures have fixed deadlines with tacit approval.
• The auction sells grid access, not revenue. It allocates a right to inject, with no right to charge from the grid and no tariff, premium or contract for difference.
• Projects must accept curtailment. Winning projects accept up to 750 equivalent hours a year of injection limits from grid congestion.
• A capacity payment may follow. A capacity mechanism open to storage is planned but needs European Commission approval.
• Reserve markets are opening to batteries, but their volumes are small compared with the solar fleet.

Decree-Law 130/2026

Decree-Law 130/2026 (published 29 June, in force 28 August 2026) amends Decree-Law 15/2022, the law that governs Portugal’s electricity system. The points that matter most for storage:

• Planning, building and operating storage installations, including their grid connection, are presumed to be of overriding public interest (Article 4).
• Prior-control procedures get fixed deadlines with tacit approval. The whole procedure is capped at two years, or one year inside the new renewable acceleration zones (ZAER) (Articles 14 to 14-B).
• Storage that sits with solar on buildings or other artificial structures, and storage inside a ZAER that follows the zone’s rules, is exempt from environmental impact assessment (Article 42).
• Storage can be granted grid access with restrictions, which can become permanent where reinforcing the grid would be inefficient. A certified power-control device is required (Article 52-A).
• Grid operators must publish available connection capacity every quarter (Article 113).

The standalone storage auction

	Standalone storage	Co-located with renewables
Grid capacity offered	750 MVA	300 MVA
Locations	Nine nodes on the 400 kV grid	Three nodes
Bid size	50 MVA minimum, 200 MVA maximum per participant	50 to 100 MVA
Storage required	Power of at least 100 % of awarded capacity, at least 4 hours	At least 20 % of awarded capacity, at least 4 hours
Auction share to host municipalities	30 %	70 %

Source: ESS News, 23 September 2026, based on the consultation documents.

The government plans to allocate the capacity through an ascending-clock auction in €/MVA, run by DGEG on a platform operated by OMIP. Projects accept up to 750 equivalent hours a year of injection limits from grid congestion, and developers pay their own connection costs. The launch, planned for 14 September, was postponed to incorporate feedback from the public consultation. No new date has been published.

What the auction does not include is as important. It allocates a right to inject, not a right to charge from the grid, and it comes with no guaranteed tariff, premium or contract for difference. Revenue is merchant: energy markets plus system services. The decree-law allows two-way contracts for difference for renewable generation (Article 17), but the auction does not use them.

The capacity mechanism

In June the Ministry of Environment and Energy announced a capacity mechanism, open to generation, storage and demand response, that would pay for availability at times of peak demand. It is based on a security-of-supply assessment by DGEG, REN and ERSE, which set a reliability standard of 1.46 hours a year. The mechanism needs European Commission approval, and Portugal has started pre-notification.

Reserve markets

Besides energy trading, batteries can earn from balancing. REN, the transmission system operator, buys automatic frequency restoration reserve (aFRR, called secondary control band in Portugal) and manual reserve (mFRR). Portugal joined MARI, the European mFRR platform, in November 2024. In July 2026 REN reported 1,668 MW authorised for mFRR and 340 MW for aFRR, including battery storage alongside solar and wind.

For a battery owner this means the route to stacking energy arbitrage with reserves exists, and it is opening to batteries. The volumes are small compared with the solar fleet, however. As more batteries qualify, reserve prices are likely to fall. A Portuguese business case should therefore rest on energy spreads first and treat reserves as an addition.

What it means

For standalone projects and investors. The new decree-law removes some permitting friction, but the auction is a grid-access auction, not a revenue auction. Developers should price in three things: the separate contract needed to charge from the grid, up to 750 hours of curtailment a year, and merchant revenue until the capacity mechanism is approved. Until then, the strongest projects will be those that combine energy trading with reserves, through an experienced trading and balancing partner.

For businesses. Most of the auction rules apply to grid-scale projects. For a business adding a battery behind its meter, the changes most likely to matter are the public-interest presumption, the fixed permitting deadlines and the environmental assessment exemption for storage on buildings and other artificial structures. How they apply depends on the size and connection of each project, so check the licensing route with your installer or legal adviser early.

Sources

1. Decreto-Lei n.º 130/2026, de 29 de junho (Diário da República)
2. DGEG, Decreto-Lei n.º 130/2026, changes to the national electricity system (in force 28 Aug 2026)
3. ESS News, Portugal delays 1,050 MVA battery storage auction (23 Sep 2026)
4. pv magazine, Portugal plans capacity market with dedicated battery storage auction (18 Jun 2026)
5. Review Energy, Portugal reaches 1.6 GW milestone for renewables in system services markets (31 Jul 2026)
6. bess.courses, Portugal electricity market (balancing products and MARI connection, Aug 2026)
7. Grid Forward, analysis of the auction programme and tender specifications (Jul 2026)