Portugal opens new funding window under the Modernisation Fund

Portugal’s Directorate-General for Energy and Geology (Direção Geral de Energia e Geologia – DGEG) has launched a new funding opportunity under the Modernisation Fund (Fundo de Modernização), with the aim of modernising energy systems, improving energy efficiency and accelerating decarbonisation, promoting sustainable growth, competitiveness and energy security. This call, now open for applications, represents a key step in advancing the energy transition and supporting innovative projects that contribute to achieving carbon neutrality targets by 2050.

Modernisation Fund: driving a sustainable future

The Modernisation Fund is one of the European Union’s main financial instruments to help the eligible Member States with lower income levels modernise their energy systems and improve energy efficiency. Financed through revenues from the EU Emissions Trading System (ETS), the fund prioritises investments that deliver measurable reductions in greenhouse gas emissions, particularly in the energy, transport, and industrial sectors.

Portugal, one of the eligible countries, is directing the fund to support energy efficiency (reducing consumption through modernization and new equipment), electricity networks (modernizing and digitalizing grids with renewables and storage), and renewable energy as well as renewable gases (creation of renewable energy, green hydrogen and other clean gas infrastructure). The initiative aligns with the country’s National Energy and Climate Plan (PNEC 2030) and complements European Green Deal objectives.

Who can apply and what is funded

This call is open to private companies of any size or sector legally established in Portugal and compliant with tax, social security, and labour obligations. Projects must contribute to the objectives of the Modernisation Fund, reducing energy consumption, replacing fossil fuels with renewable sources, cutting greenhouse gas (GHG) emissions, and reinforcing energy resilience.

Eligible actions include:

• Energy efficiency improvements in buildings, industry, and services, such as energy audits, replacement of boilers or equipment with renewable-based systems, modernization of processes, and rehabilitation of industrial and service buildings to reduce final energy use;
• Modernization and digitalization of electricity networks, including smart grids, active demand management, collective self-consumption, energy communities, and deployment of charging infrastructure for electric mobility;
• Energy storage and flexibility solutions, including batteries, hydrogen systems, and other technologies that strengthen grid resilience and integration of renewables;
• Renewable gases, including the production, injection, and use of green hydrogen, biogas, or biomethane, as well as related infrastructure for transport and storage;
• Clean energy generation and electrification of processes, such as installing photovoltaic systems, heat pumps, or other renewable technologies supporting decarbonization.

Deadlines and next steps

Applications must be submitted through the DGEG email, until 15th December Interested applicants are strongly encouraged to consult the official call documents available on the DGEG website for detailed eligibility criteria, timelines, and evaluation procedures.

As Portugal continues to channel European funds into clean energy initiatives, this new call represents an important opportunity for organisations seeking to lead the country’s low-carbon transformation.

“The Modernisation Fund is not only about decarbonising — it’s about rethinking and modernising our entire energy system,” explains André Guimaraes, Innovation Consultant at Zabala Innovation. “It provides a powerful tool for companies and public entities to accelerate sustainable investments and strengthen Europe’s energy autonomy.”

Would you like to explore how your project could benefit from the Modernisation Fund?
Contact Zabala Innovation to identify the best funding strategy and boost your energy transition initiatives.