The aim of this paper is to analyse the deployment and current prospects of the renewable energy sector in Portugal. This sector has emerged at the confluence of new technological opportunities and strong policy incentives, through the creation of a large number of new technology-intensive firms together with the entry of some major incumbents, of the electric sector mostly, into the business. With the budgetary crisis, severe restrictions impacted the sector significantly, combining the decrease of incentives with a substantial rise of uncertainty. However, favourable shifts have also been at work. In fact, technologies have become more cost-effective, albeit at a differential pace in the various areas. In fact, the renewable energy technologies have reached different levels of maturity and market acceptance, offering distinct levels of opportunity for firms operating in the sector. In this paper we focus on the strategies deployed by firms producing renewable energy technologies in Portugal, to deal with both policy shifts and a high degree of uncertainty, while at the same time taking advantage of technological evolution, static and dynamic economies and more favourable supplier and demand market conditions. Innovation and business strategies have been associated, resorting to an array of alliances with research organizations and other firms, at domestic and international level. These strategies and alliances have had distinct degrees of success due, among other aspects, to the heterogeneity of technological areas within the renewable sector. In addition, other policies have been impacting the sector such as anti-dumping measures at the European level. We adopt a framework that: a) addresses context shifts (domestic and European policy, operating in several domains, such as renewable technologies development, business supportive schemes, R&D support, and fiscal and trade policy; world competition; public acceptance) and their impact on entrepreneurial behaviour; b) views the innovation process in a broad sense, comprising the relations established to access external resources/competences; c) takes into account the distinctive evolution path of the various renewable energy technologies; d) addresses the interplay between firms’ innovation and business strategies. The framework is applied to 50 Portuguese renewable energy technologies firms. Data were collected through detailed interviews, based on a semi-structured questionnaire, with the founders or CEOs, complemented with extensive documentary information. The analysis permitted to identify: 1) the existence of distinctive innovation strategies according to dimensions, such as the relations with research organizations and technology strategies; 2) the multiform combination of innovation and business strategies; 3) the role of alliances and networking, at national and international levels; 4) the impact of contextual changes on firms strategies and achievements; 5) the sector evolution prospects. Conclusions draw on the Portuguese case but aim at contributing to the general ongoing debate on the renewables sector prospects.

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renewable energy technologies; renewable energy sector; innovation strategies; business strategies; firms’ alliances and networks; European and national policy for renewable energy technologies