Portugal will require data centres to be powered by renewable energy and to use cooling technologies that do not draw on fresh water, Environment Minister Maria da Graca Carvalho told parliament on November 3. The government is finalising a decree under which data centres would face stringent requirements on water use and a very rigorous environmental review, with the licensing criteria expected before the end of the year.
Projects will have to either use cooling technology that requires no fresh water, or a water solution that does not conflict with supplies for the general population and other economic activities. Operators will not have to generate their own renewable power; they can buy it from utilities, in a country where more than 80 percent of electricity came from renewable sources in 2025, on European Commission data.
The rules land on a market growing faster than its permitting framework. More than 2.6 gigawatts of data centre capacity is under development in Portugal, led by the 1.2 gigawatt Start Campus project in Sines, backed by Microsoft AI infrastructure investment. Start Campus already runs its first building on renewable energy with seawater cooling, which is the compliance template the decree would generalise.
Portugal follows its neighbour. Spain proposed in August that data centers source at least 80 percent of their electricity from new renewable generation on an hourly basis, and in October raised the size threshold for the rules from 1 megawatt to 10 megawatts. The Iberian approach contrasts with the United States, where this week’s ballot results show conditions being imposed town by town after projects are proposed, rather than nationally in advance.