As many universities provide funding covering only part of the tuition fee or living expenses, especially in the UK where tuition fees are different for UK/EU and international students while most scholarships only cover the first one, i.e. international students have to pay the difference. My question is whether it is possible for PhD funding to be updated/upgraded (to cover more expenses) if a student performs well, e.g. produce high quality publication, while doing his PhD.
Is it possible? YES.
Will it be likely? NO.
The funding model depends entirely on the institution who is funding you. It is ultimately up to them as to how you will be compensated for your time and effort.
If you are concerned about sustaining yourself through your study there are other avenues which candidates pursue such as lecturing/tutoring, marking and being a research assistant. Additionally there may be other scholarships available to you from the university or from external institutions.
I cannot speak for the UK/EU but in the US, your funding is not generally "updateable". It always increases by a non significant inflationary rate amount every year.
The only way in which funding is generally updated is if you acquire for yourself some other funding sources which replace your base funding because they have a higher stipend level eg. NSF graduate fellowship, MSR fellowship, Facebook fellowship etc.
The other way in which my funding has been supplemented at least in my case is my ex-adviser used to give me some more funds as research expenses out of his discretionary funding (or other grant funding, I am not sure) because I was involved in extra projects (not directly related to my own but I was brought in as an analyst) on his request.
I do not think that publishing in great journals/conferences will bring in more funding for you (in general)