Shorten licensing times or risk losing data and AI centres investment says EDP CEO

Text and image: Chris Graeme

Portugal’s cumbersome and lengthy licencing procedures are acting as a real barrier to attracting overseas investment, particularly US investment, in data centres, according to the CEO of Portugal’s multinational electricity producer EDP, Miguel Stilwell d’ Andrade.

The warning was issued at the conference/debate “The ‘Data-to-Doorstep’ Boom in Portugal: Data Centers, Submarine Cables and Logistics as the New Transatlantic Real Estate”, organised by the American Chamber of Commerce in Portugal (AmCham Portugal), which took place at the headquarters of the Morais Leitão law firm in Lisbon today. (Wednesday, April 22)

Addressing the importance of infrastructure in the energy sector which was “absolutely one of the key themes, not only from a geopolitical point of view but also regarding data centres”, Stilwell de Andrade said the sector was undergoing a paradigm shift in terms of energy demand after decades in which demand had been basically stagnant and in some cases reduced in Europe, for example, because of deindustrialisation and greater energy efficiency gains.

Soaring demand expected

“Now, for the first time, we’re seeing an increase in demand and expecting an even greater demand over the next few years”, he said, adding that Portugal needed to be prepared and not miss the boat.

Last year, Portugal was the country in Europe that most grew in terms of electricity demand while the Iberian peninsula in general grew above the European average.

German demand had basically stagnated, but demand in Portugal grew 3% and this growth is “expected to remain or grow for the next five to 10 years”.

“This demand is something we’re seeing in the United States and not just Portugal where for the first time we’re seeing a large increase in demand for electricity”, said the EDP CEO.

And this structurally changed the way in which the energy network is seen as well as the equilibrium in the system – all of which needed to be upgraded to cope with demand, much of  which, he said, had to do with data and artificial intelligence centres (AI).

“I think that at the end of the day we all agree that AI is going to be extremely disruptive, and is going to require chips, connectivity, and lots of energy”, said the EDP CEO.

Electrical energy was needed for data centers to process and move data and if electrical vehicles, hydrogen manufacturing/processing and industrialisation were all added, it represented a very large change in paradigm.

The United States and the Iberian peninsula are the two main markets for EDP – 60% of the company’s investment goes to the United States, most of it in renewables, while a large part of the remaining investment was in Spain and Portugal.

Therefore, these were the two geographical regions that would see a huge increase in demand over the next few years for the energy provider.

In Portugal, the government has launched a process in order to try and secure something tangible regarding the various applications to be linked to the network.

Applications for some 40 GW have already  been submitted, but so far only 5.6 GW has appeared backed with guarantees.

For example, data centres are being pursued by Equinix in Lisbon, another by Atlas Edge in Carnaxide, a third from Merlin Properties in Castanheira do Ribatejo, and a fourth from Voltekko in Alcochete. And that’s just some.

In fact, there are approximately 10 to 11 upcoming or planned data centre projects in Portugal as of early 2026, with an additional 12 to 14 existing operational facilities, mainly concentrated in the Lisbon and Porto regions.

And when looking at the total market portfolio, various reports indicate some 25-33 facilities of varying sizes either existing or planned.

Not only this, Portugal is emerging as a global connectivity hub with some 15 submarine cables expected to serve the country soon and vital for its data and AI centres, yet the government does not yet have adequate security strategies onboarded in a world where submarine cable mapping espionage and sabotage – particularly from the Russians – is an increasing threat.

The largest of these projects to date is the huge US-funded €8.5Bn Start Campus project at Sines, South of Lisbon, which represents a campus of several data centres and which is next door to an old decommissioned EDP power plant.

Licensing a headache

But one of the problems is licensing which can take around five to six years to get approval and is a block to investment.

But Miguel Stilwell said that Portugal is not the worst country in Europe when it comes to getting planning permission, but urges that the government and municipal councils need to speed up the processes in order to not lose demand for such projects linked to data centres.

“Portugal is not one of the worst countries for licensing, but taking five or six years to license a project that takes 12 to 18 months to complete ends up being a barrier to investment,” stated the CEO of EDP.

And requests for electricity network links entail an additional 7GW of installed capacity over the next years but this is not sufficient to meet a demand of 10GW.

“If we transform this into energy consumption,, not the potential maximum they will use, we’re basically talking about doubling Portugal’s consumption in the next few years”, he said.

Start Campus  – 20% of Portugal’s electricity consumption

Start Campus alone, he said, will represent 20% of Portugal’s consumption, and if all these applications were processed today we’re talking about staggeringly large amounts of electricity demand.

Getting all these projects off the ground require considerable investment; investment in grids and networks such as in the companies REN and E-Redes.

EDP has already made a proposal that has been approved by the regulator but has not yet been approved by the government for there to be a 70% uptick in network investment over the next five years – that is 70% more than the investment made over the past five years in Portugal.

In fact, EDP plans to invest approximately €1.7Bn in Portuguese electricity networks between 2026 and 2028 as part of a broader €2.5Bn investment in the country.

This investment focuses on strengthening, digitalising, and modernising infrastructure to accommodate renewable energy and increasing electrification needed to serve data and AI centres and is part of a broader €3.6Bn investment on the Iberian peninsula.

This will include grid modernisation with investments enhancing network intelligence and automation to manage high renewable energy intermittency and electric mobility needs.

But investment in grids and networks alone is not enough. There has to be investment in generation because without this the expected demand cannot be met.

All of these projects and investments can only boost Portugal’s growth and economy, but the government needs to create the right conditions so that these investments can be successful”, concluded the CEO of EDP, Miguel Stilwell d’ Andrade.