Power Purchase Agreements (PPAs) were created in 1995 and established a system to compensate investment in power plants. The producers were paid for the investment and for the production availability of their plants, and were compensated for all the costs they incurred during production. The producer's role was to produce the amount of energy indicated by REN.

Created in 2007 for all consumers, the liberalized market started giving customers the freedom to choose their electricity and natural gas provider. In the liberalized market, it is the providers who define the commercial supply and the respective energy prices, which encourages competition for the benefit of the consumers.

The Costs of Maintenance of Contractual Equilibrium (CMCE) were created in 2004 and implemented in 2007 after the early termination of the PPAs. The aim of the CMCEs was to maintain financial neutrality in relation to the PPAs. Thus, it was established that the compensation would be the difference between the value of the PPA and the revenues that the plants obtained in the market. This mechanism, negotiated between the State and the European Commission, was approved by the Portuguese Parliament and validated by Brussels.

The termination agreements, established between producers and REN and approved by the Government, stipulate the detailed conditions for achieving the early termination of the PPAs. These agreements always have as guiding line and limits what was defined in the Decree-Law that created the CMCE.

In 1995, with the PPAs creation, the rules for the use of the Public Hydric Domain (PHD) are established, establishing that EDP would receive the residual value of the power plants at the end of those contracts if it delivered the dams to the State. However, since it was also possible for the producer to choose to continue to operate the plants beyond the end of the PPAs, EDP decided to do so by giving up a 1356 million sum and paying 759 million euros for the PHD extension. The amount paid, which includes the rate of utilization of water resources, was calculated after consulting two independent entities at the request of the Government and following a methodology already validated by the European Commission.

With the creation of the CMCEs, a sum of 3356 million euros was set, which the State would have to pay in stages to EDP to compensate for the end of the PPAs. This amount resulted from the calculation between the remuneration provided in the PPAs and the expected revenues from the plants. However, in 2007 the sum was eventually reduced to 833 million euros, after the market prices of electricity and fuels were updated. This value was the target of annual adjustment in the first ten years of the mechanism, between 2017 and 2027. For the last decade, which will end in 2027, the final revisability was calculated, the last of the CMCEs settlement of scores. This adjustment consists in updating the amounts receivable by the producers against the remuneration initially set.

A part of the power plants' remuneration is due to their capacity to be able to produce if that is necessary (availability). In this sense, within the CMCEs framework, there is a reference value above which the plants receive a higher remuneration; and a value below which they receive a lower remuneration. From the creation of the PPAs up until today, power stations have declared to the system operator (REN) whether they are available or not. This availability is introduced in the remuneration models and the compensation paid to CMCE stations is calculated.