The environmental market in Portugal is one of the most dynamic in Europe as the country has been making a strong effort to comply with EU standards.
Environment and Water sector in Portugal
The environmental market in Portugal is one of the most dynamic in Europe as the country has
been making a strong effort to comply with EU standards. The sector is highly state-controlled
and dependent on EU funding. Good access to Ministers and senior officials is therefore a key to
the success of business.
The most recent statistics available (INE – Instituto Nacional de Estatística) indicate that
environment protection spending by the Portuguese Government totalled approximately €1.07
billion in 2010. Local Government invested over €674 million accounting for 63% of the total
spending. Local Government invested mainly in waste management, while central Government
focussed more on bio-diversity and landscape protection. The figures from industry show that in
2010 companies invested €164 million in environment, monitoring activities, prevention,
reduction or pollution abatement. Total industry spending was €239 million, with a generated
income of €109 million. Latest figures show that out of the total Portuguese population, 96% is
covered by public water supply systems, 84% is covered by sewerage systems and 73% is
covered by wastewater treatment plants.
Portugal has been benefiting from EU funding for the period of 2007-2013 through the
investment framework, the National Strategic Framework Programme (QREN - Quadro de
Referência Estratégica Nacional), which totals €20 billion. The environment sector is one of the
priority areas within the programme. The amounts defined by QREN for investment support in
the water and waste management sectors add to a total of €1.95 billion. The amount of funding
still to be implemented is over €1.2 billion – of which €900 million have been approved and
€300 million are still to be approved. The main areas of financing are within water management
and distribution, and wastewater treatment
Overall prospects for UK environmental suppliers within the Portuguese market are good. The
market is open to foreign products, ideas, technology, and competition is relatively weak.
Specific opportunity areas for UK companies are in:
ξ Consultancy (namely for privatisation and concession projects)
ξ Efficient use of water (including energy efficiency for water systems and buildings)
ξ Soil remediation services and technologies
ξ Sludge handling and treatment
ξ Waste handling and treatment, including waste to energy technologies based on anaerobic
digestion, combustion, gasification, pyrolysis, etc (urban, industrial, clinical and
ξ Industrial air pollution control (particulates and gas scrubbing)
ξ Environmental monitoring systems (water, air and waste)
ξ Municipal wastewater treatment (primary, secondary and tertiary, including small-scale
ξ Industrial wastewater treatment
Portugal as a Platform to other Portuguese Speaking Countries
In the wider context, Portuguese firms may make ideal partners for UK companies in accessing
environmental opportunities in Portuguese-speaking markets further afield, principally Brazil,
Angola and other parts of Africa.
AdP – Águas de Portugal (AdP), which is the state holding for the Water, Wastewater and
Environment sectors, is one of the companies that will have to re-structure its operations. This is
following the agreement between the Portuguese Government with the IMF and EU on the terms
of the bailout to Portugal. Besides reducing its operational costs AdP is looking at the
governance model which will include the change of the shareholding structure of its subsidiaries.
This will include both privatisation and the establishment of concessions. The plan will include
the Privatisation of EGF – Empresa Geral de Fomento (sub-holding for the waste sector), until
the end of 2013, and concession of AdP water and wastewater operations before 2015.
Knowledge of this type of processes is welcomed by the Portuguese water market.
Restructuring of the Environment and Water sector
Prior to the Privatisation, AdP (Águas de Portugal) will restructure by merging its multi-
municipal systems (around 40), wholesale, retail and its water and wastewater treatment to create
new 4 to 5 multi-municipal systems. Besides opportunities for consultancy companies, there are
investments of €365 million for upgrade of the systems components.
Soil Contamination and Rehabilitation
There are around 2,000 contaminated sites to be remediated and regenerated in Portugal. This
includes 175 abandoned mining areas.14 were considered a priority and 8 of these are being
treated as well as 3 major industrial sites (Sines, Seixal and Estarreja).
Soil remediation is one of the priorities. There is a total allocation of €95 million (Cohesion
Fund) to remediate the most problematic sites in Portugal. This includes 5 industrial sites (€50
million) and approximately 20 abandoned mining areas (€45 million). Up until the first half of
2011, €65 million had already been approved and allocated.
The recent Government support to the upgrade of the mining industry in Portugal will bring the
need for expertise in consultancy services as well as technology to reduce the impact of its
operations and promote a sustainable development. Environment services for the mining industry
are amongst the top opportunities within this sector in Portugal as there are few companies with a
proven track record in this area.
This will be another area of interest to UK companies, as Portugal is investing in waste
management systems. These include
ξ Digestion and
ξ Other technologies to valorise the organic fraction of the MSW including Fuel from
Recently the Minister for Environment mentioned support to deploy up to 23 Solid Waste
Valorisation plants (up from 8) which include Biogas and other Waste to Energy solutions. In the
recent past there has been interest in thermal technologies, ORC and others for the Waste to
ξ Enforcement of the EU Directives on the IPPC; VOCs, Mercury and PCBs.
ξ An increasing emphasis on enforcement as a means of correcting the poor standards of
pollution control and waste management applying throughout Portuguese industry.
ξ Increasing industrial demand for effluent control, waste management and air pollution
control. Both for products and services, in response to stricter enforcement.
ξ Investment in disposal and treatment facilities for municipal, industrial, hospitals and
hazardous waste and sewage sludge.
The amounts foreseen by QREN for investment support in the water and waste management
sectors add to a total of €1.13 billion are distributed as follows:
ξ Water supply and wastewater management of urban wastewater at a "wholesale" level:
€300 million Euros (Cohesion Fund);
ξ Water supply and wastewater management of urban wastewater through "wholesale and
end-users verticalisation": €480 million (Cohesion Fund);
ξ Water supply and wastewater management of urban wastewater at an "end-users" level:
€220 million (FEDER);
ξ Municipal waste: €130 million (FEDER).
Regarding future investments, it should also be noted that:
ξ PEAASAR II (Strategic Plan for Water Supply and Wastewater Treatment) estimates that
investments in the order of €3.8 million are needed in water supply and wastewater
management systems, divided between wholesale (€1.6 million) and retail (€2.2 million);
ξ ENEAPAI (National Strategy for Agricultural and Agro-industrial Effluents) predicts that
approximately €200 million will be needed to cover activities in the area of livestock
production and agro-industrial effluents;
ξ PERSU II, which covers the period 2007-2016, anticipates that investments of €805
million will be needed in municipal waste management systems in the period 2007-2013
(the QREN application period).
In short, the need for investment in the areas mentioned in the above plans rises to €7.6 million
in the period of 2007-2013.
Latest export opportunities in the Environment & Water sector
Latest export opportunities in Portugal
Getting into the market
Decision-making tends to be rather politicised and bureaucratic. At a more practical level,
English is spoken though not to a great extent. Thus, some form of collaborative relationship
with a Portuguese company is likely to be the best means of market entry. For standard, ‘off-the-
shelf’ equipment, a licensing, distributorship or agency agreement may be sufficient. For larger
projects, some form of joint venture will be required. In particular, local consulting engineering
practices are very small and are often tied to manufacturers and/or short of capital, so equity
participation or joint ventures are likely to be well received.
Portugal is a family type market where local companies frequently ask for agency agreements on
an exclusive basis. This is the most suitable arrangement if the potential agent has a large sales
force and covers the whole of Portugal. The other possibility, if a suitable agent is not found, is
to appoint a number of distributors throughout the country (e.g. one for Northern Portugal and
another one in the South). The appointment of a distributor will only be the first step. It is
advisable to maintain a good relationship with them and keep them informed of all developments
and modifications of your range of products. The Portuguese invariably prefer personal contacts.
Therefore regular visits to the market are as important as continuous support to the agent /
UK companies should aim to compete in the Portuguese market on price, quality or innovation
(in equipment and commodity markets), or on standards of service and the ability to offer
integrated, ‘packaged’ solutions (in service and contracting markets).
In the wider context, Portuguese firms may make ideal partners for UK companies in accessing
environmental opportunities in Portuguese-speaking markets further afield, principally Brazil
and parts of Africa. The latter will rely on donor funding (from agencies such as the World
Bank) but the Brazilian market is growing largely under its own steam.
More about doing business in Portugal
Market intelligence is critical when doing business overseas, and UKTI can provide bespoke
market research and support during overseas visits though our chargeable Overseas Market
Introduction Service (OMIS).
To commission research or for general advice about the market, get in touch with our specialists
in country - or contact your local international trade team.
Frederico Lyra, British Embassy in Lisbon. Tel: +351 21 392 4068 or email:
Carlos Fernandes, British Embassy in Lisbon. Tel: +351 21 392 4069 or email:
UKTI runs a range of events for exporters, including seminars in the UK, trade missions to
overseas markets and support for attendance at overseas trade shows.
Latest events in the Environment and Water sector
Water Expo and Conference
Date: 16-17 October, Lisbon
Website address: http://expoagua.ambienteonline.pt/noticias/detalhes.php?id=1534&idSec=292
Urban Mobility Conference
Date: 18 September, Lisbon
Website address: http://www.jornalarquitecturas.com/Conferências/Apresentação.aspx
More about OMIS and other UKTI services for exporters