There are still 27 years to go until the magical date of 2050, when most companies and countries should achieve carbon neutrality. In this area, Portugal has been ambitious and has brought forward the target to 2045, but much work will still be needed before the country can benefit from the economic potential of the “sustainability imperative”. “By proactively decarbonizing current industries, Portugal can double its capital attraction to around 20 billion euros per year,” assures McKinsey & Company’s sustainability leader for the Iberian Peninsula, in the context of the Estoril Conferences.

Bruno Esgalhado does not hold back on his predictions and also adds the possibility that the country will generate “300,000 jobs” and grow its gross domestic product (GDP) by between 10% and 20%. Attracting investments will be crucial to increase the rate of decarbonization of the national economy by 20%, a value that the consultant considers important to achieve the goal of carbon neutrality. However, the question arises as to how the country can get there. “Portugal can become one of the most important green hydrogen hubs in Europe,” emphasizes the person responsible.

Hydrogen is part of Portugal’s energy transition strategy, in fact raising €185 million in financing from the Recovery and Resilience Plan (PRR). Now that Portugal is recognized internationally as one of the future leaders in the production and distribution of this energy, Bruno Esgalhado highlights its ‘solar potential and export infrastructure’ as two factors that can guarantee competitiveness on the international market. The country can “achieve economic viability of these new technologies five to seven years earlier than its partners in Western Europe,” the analyst says.

In May, European Commissioner for Energy Kadri Simson was at the Assembly of the Republic, where she clarified the expectations of the European Commission (EC) on the role that Portugal can play in the production of green hydrogen. “We count on Portuguese and Portuguese hydrogen producers so that a significant part of this hydrogen can be produced here in this decade,” he stated. In a race against time to ensure its energy independence, the EC has doubled funding for the development and expansion of green energy, something that should continue to happen in the coming years.

We have to keep growing

“The race has already started. I am talking about the race to see which countries and companies can benefit from the enormous opportunities created by the need for sustainability.” This is how the intervention of Harry Bowcott, senior partner at McKinsey & Company, began at the last edition of the Estoril Conferences, where he was there to say that “we must do more” to explore the economic potential of carbon neutrality. The first challenge, he says, is to accelerate the maturity of “climate technologies” such as wind and solar energy, which, although they have advanced significantly in the past decade, “need to grow six times more.” The consultancy estimates that to reach the net zero emissions milestone by 2050, it will be essential that wind energy grows sixfold, while solar energy development will need to be multiplied by a factor of 14, by a factor of 200 in hydrogen and carbon capture must increase by a factor of 100. . “This should be seen as an opportunity,” emphasizes Harry Bowcott.
The expert highlights eleven areas where the potential for value growth driven by decarbonization could generate up to $12 billion in annual revenues by 2030. Below this, the emphasis is on agriculture, water management, energy, transport or energy management waste. Bowcott also talks about the reallocation of capital, driven by necessary infrastructure investments, which could benefit from 60% growth compared to current levels.

Speed ​​seems to be the key word in this transition. “There is a lot we can learn from previous revolutions, such as fintech or technology,” he assures. And one of the most important lessons we learned is agility and the ability to develop quickly. “We are talking about a substantial change in the way we do business,” he adds. The size of investments expected by McKinsey “would allow the creation of 300 decacorns”, i.e. companies with a value of at least 10 billion euros. “Your company could be one of those,” Bowcott challenges. In an interview with Dinheiro Vivo on the sidelines of the Estoril conferences (see interview opposite), the analyst highlights some ingredients that he considers essential for the success of companies and countries, including Portugal, in this journey towards carbon neutrality.