In a Nutshell
- Portugal mostly focuses on increasing the natural carbon sink capacity of the land use, land use change and forestry (LULUCF) sector.
- Under its national climate law, a maximum of 10% of emissions may be removed to achieve climate neutrality in the sectors covered.
- Portugal launched a national carbon market based on the Carbon Removal Certification Framework.
- Portugal developed a EUR 1 billion scheme to support strategic sectors to reach climate neutrality, including carbon capture usage and storage, which was approved by the European Commission in late 2024.
Role for carbon removal in national climate policy
The Roadmap for Carbon Neutrality 2050, Portugal’s national long-term strategy released in 2019, discusses the role of carbon capture and storage (CCS), carbon capture and utilisation (CCU) and carbon dioxide removal (CDR). It labels CCS as an important option to decarbonise the energy system, though it considers economic and technical viability only to be attainable in the cement sector. According to the roadmap, bioenergy with carbon capture and storage (BECCS) is currently not cost-effective, though technological development will be monitored.
The final updated National Energy and Climate Plan (NECP), submitted to the Commission in October 2024 brings additional elements regarding CDR. The main focus is on increasing the natural carbon sink capacity of the land use, land use change and forestry (LULUCF) sector. Although contributions of CCUS are considered as part of the decarbonisation of the industrial and business sector, the plan mistakably conflates CCUS and CDR. It also acknowledges the upcoming Carbon Removal Certification Framework (CRCF) as part of the development of its national voluntary carbon market. This market has already been launched and will align with the rules established by the CRCF. The plan also mentions the development of a green industrial strategy, and the creation of a new Climate Agency to oversee the implementation of climate policy.
Relevant legal frameworks
The Portuguese Climate Framework Act entered into force on 1 February 2022 and sets an objective to reach climate neutrality by 2050. It establishes emissions reduction targets of at least 55% by 2030, 65% to 75% by 2040, and 90% by 2050 compared to 2005 levels, excluding soils and forests. The law stipulates that a maximum of 10% of emissions may be removed to achieve climate neutrality in the sectors covered. Additionally, a net removal target of on average 13 MtCO2eq is set for the LULUCF sector between 2045 and 2050. The law states that coastal and marine ecosystems should also play a role in reaching this target, setting multiple policy objectives, including the development and reinforcement of ‘current carbon sinks and other carbon sequestration services’.
Support for R&D and Innovation
The Portuguese Recovery and Resilience Plan only has limited links to CDR. Of note is the creation of a ‘Hub Azul’, a blue hub, aimed at creating a thriving blue economy. The hub will support startups, research and development, and marine infrastructure. Marine-based CDR could fall under this funding. The rest of the plan does not mention CDR-related measures, nor does it mention CCS.
The Intermunicipal Waste Management of Greater Porto (LIPOR) is part of a research consortium piloting an industrial-scale CCU facility at a waste-to-energy plant. Part of the process could create negative emissions. Veolia, which manages the plant, announced in July 2025 that it will be conducting feasibility studies for a carbon capture unit that could reduce the plant’s CO2 emissions by over 90%.
The voluntary carbon market, which came into effect in January 2024, includes emissions reduction projects and carbon sequestration projects. It establishes rules for its functioning and requirements and procedures on how the carbon credits can be used. Nature-based solutions are favoured, with a special focus on blue carbon and forest-related projects, even though engineered removals are mentioned. Initially planned to only allow offsets for residual emissions, requirements have been watered down to allow any emission to be offset.
The University of Evora and the University of Lisbon take part in the PilotStrategy project, an EU-funded project exploring geological CO2 storage capacities in industrial regions of southern and eastern Europe. PilotStrategy follows after the Strategy CCUS project, which ran between 2019 and 2022. Evora also received funding to conduct the InCarbon project to evaluate the potential of some geological formations to store CO2 captured from large industrial and energy generation sources. The PilotStrategy project is ongoing until April 2026.
A new sate-aide scheme to support strategic sectors necessary to reach climate neutrality was approved by the EU Commission. The scheme will provide EUR 1 billion in direct grants to fund companies producing relevant equipment, namely batteries, solar panels, wind turbines, heat-pumps, electrolysers, equipment for carbon capture usage and storage. It will run until December 2025.
On the horizon
The electronic platform for the national voluntary carbon market is expected to become operational in the second half of 2025.