Renewable Energy Policy in EU-27

Renewable Energy Policy in EU-27

An overview on the status 2008, the
implementations, development barriers and the
future

Cologne, 26th of May 2009

Frank Schillig
Director International Business Development Bio- & Solar Energy

RES-E policies in EU-27

Renewable Energy – a never ending story

What will you learn today? - content

- Who is Ecofys?
- What is RES-E/-H/-T?
- RES-Targets, -Status, -to-do (Outlook)

…and maybe some more ☺


Who is Ecofys?
• Founded in 1984
• > 1400 employees
• 20 countries
• turnover 2008: > 800 Mio. €


Office network

• Invoegen kaart Ecofys met vestigingen
• Aangeven waar wind expertise zit
• Globaal aangeven hoeveel mensen


Motivation I –
GHG abatement potential and costs
Potential GHG emissions avoided by 2030 for selected electricity
generation mitigation with estimated mitigation potential shares spread
Mitigation potential; total emissions saved in 2030 (GtCO2-

across each cost range (2006 US$/tCO2-eq)

2,0

1,8

1,6

1,4
World potential
1,2
50-100 $/tCO2-eq
eq)

1,0 20-50 $/tCO2-eq
0-20 $/tCO2-eq
0,8
<0 $/tCO2-eq
0,6

0,4

0,2

0,0
OECD

non-OECD

OECD

non-OECD

OECD

non-OECD

OECD

non-OECD

OECD

non-OECD

OECD

non-OECD

OECD

non-OECD

OECD

non-OECD

OECD

non-OECD
EIT

EIT

EIT

EIT

EIT

EIT

EIT

EIT

EIT
Fuelswitch Nuclear Hydro Wind Bioenergy Geothermal Solar PV CCS + CCS +
and plant and CSP coal gas
efficiency

Source: Ecofys based on data IPCC Fourth Assessment Report, Working Group III Report quot;Mitigation of Climate Change“ 07

0%
10%
20%
30%
40%
50%
60%
Au
st
ri a
Be 34.0%
lg 12.2%
i um
Bu 13.0%
lg 10.6%
a ria
C 16.0%
yp 6.6%

RES target 2020
C ru
ze s
ch 13.0%
R 11.2%
ep

RES increase required
D . 13.0%
en
m 8.9%
ar
k
Es 30.0%
to 15.0%
ni
a
Fi 25.0%
nl
an 12.6%
d
Fr 38.0%
an 15.2%
G ce
er 23.0%
m 16.7%
an
y
G 18.0%
MotivationII –

re 11.3%
ec
H e
un 18.0%
ga 11.6%
ry
Ire 13.0%
la 8.1%
nd
16.0%
13.1%
It a
ly
17.0%
La 10.2%
tv
Li ia
th 42.0%
Lu
ua 7.7%
ni
xe a
m 23.0%
bo 13.4%
ur
g
11.0%
M 8.4%
N al
et ta
he 10.0%

rl a
nd 9.8%
s
14.0%
RES targets and increase required

Po
la 11.7%
nd
Po 15.0%
rtu 10.2%
ga
R
om l 31.0%
an 14.5%
Sl ia
ov
ak 24.0%
R 6.2%
ep
Sl . 14.0%
ov 9.3%
en
ia
25.0%
RES-E targets & required increase

Sp 14.5%
ai
n
Sw 20.0%
ed 13.4%
en 19.0%
49.0%
U
K
15.0%
13.0%

Legal framework

Most relevant EU-framework

1. Directive 2003/87/EC (EU-ETS)
• EU-wide trade scheme for GHG (green house gas) emission
allowances
• With increasing certificate prices, use of biomass might become
economical feasible even without support schemes (e.g. co-firing)

2. RES Roadmap and proposed RES Directive
• Binding 20% RES target for EU in 2020 (10% biofuels) large
increase still needed!
• GoO (Guaranties of origin) trading scheme harmonization of
EU support schemes, but unlikely to be implemented fully


Overall rating legal framework EU 27
and Russia
Results of rating - legal framework

Legend
Positive
Average
Negative

Source: Ecofys


Policy Mechanisms

• Political
• Legislative
• Fiscal
• Financial
• Administrative
• Technology development
• Information and education


Overview of primary support for RES-E
Feed-in tariffs Quota obligation
AT CY CZ
(LA)
DK EE ES FR BG
DE GR HU IT
BE IT
LT LU PT NL SE RO
SI SK PL UK

Certificate systems

IE UK
FI
DK
SI
FR MT

Fiscal
Tenders incentives


Best practice in RES-E policy
• Design of support mechanisms crucial to their success.
Important to implement best practice in policy design:
1. Removal of non-financial barriers (administrative, technical);
2. New support schemes should target just new RES-E capacity;
3. Guarantee, but strictly limit the duration of financial support;
4. Include full basket of available RES-E options;
5. Make support technology-specific; and
6. Set incentives to take account of and accelerate future cost
reductions.
• The worlds of the feed-in and quota system are showing
signs of converging on these basic principles.

…where has this led to?

(Market overview & insights)


Example: Effectiveness and efficiency
of support for onshore wind
• Effectiveness
and
efficiency
witnessed to
be highest in
FIT countries
But
• Less
experience
with Quota
obligations
• Design of
support
mechanism
Source: OPTRES, 2007, European Commission (COM(2008)19 final) crucial


Global wind energy capacity, new installation 2008

China
Rest of world 23.3 %
12.2 %

India
6.7 %

Germany
6.2 %

Spain
5.9 % USA
Italy 30.9 %
3.7 %
France
3.5 % Vereinigtes
Königreich Canada
3.1 % Portugal 1.9 %
2.6 %

Quelle: Global Wind Energy Council (GWEC):quot;GLOBAL WIND 2008 REPORTquot;, Stand Frühjahr 2009

Development ofrenewable energy sources in Germany 2008


Worldmarkt photovoltaic, 2008

Spain; 2,511 MW
France; 46 MW

Belgium; 48 MW

Portugal; 50 MW

Czech Republic;
51 MW
Japan; 230 MW

Italy; 258 MW

Southk Korea;
274 MW

USA; 342 MW

Germany;
1,100 MW
New installed photovoltaic
2007: 2,400 MWp
2008: 5,500 MWp
Quelle: European Photovoltaic Industry Association, 24.3.2009


Legal framework

Attractive RES-E tariffs solid biomass in
EU-27

RES-E tariffs for solid biomass plants in EU-27

BG MIN
PL MAX
NL
CY
SK
IE
HU
ES
AT
CZ
LV
DE
IT

0 50 100 150 200 250 300 350
RES-E tariff [€/MWh]


Level of support vs generation cost for
onshore wind

Source: OPTRES, 2007, European Commission (COM(2008)19 final)


RES-share in Germany 2007/2008
16.0

0.6 Hydropower Wind energy
14.0 0.5
Biomass Photovoltaics
12.0 4.2
3.7 Solar thermal energy Geothermal energy

10.0
[%]

0.2 0.2
8.0
0.3 0.3
6.4 6.6
6.0

4.0 7.3 7.3
7.0
6.1

2.0 3.4 3.4

0.0
2007 (14.0 %) 2008 (14.8 %)
2008 (14.8 %) 2007 (7.5 %) %)
2008 (7.7 %) 2007 (7.3 %) 2008 (6.1 %)
2008 (6.1 %)
electricity * heat ** biogenic fuels

*biomass: solid, liquid, gaseous biomass, biogenic share of w aste, landfill and sew age gas; **biomass: solid, liquid; gaseous biomass, biogenic share of w aste;
Deviations in the totals are due to rounding
Source: BMU-KI III 1 according to Working Group on Renew able Energies / Statistics (AGEE-Stat); Version: April 2009; all figures provisional



Electricity generation from
renewable energy in Germany I
120,000
EEG 2009
Hydropower Wind energy Biomass* Photovoltaics ex 1 January 2009
100,000
EEG
1 August 2004
Electricity generation [GWh]

80,000

EEG
1 April 2000
60,000
FEC
Amendment to BauGB share
November 1997 14.8 %
40,000 StrEG
1 January 1991

20,000

0
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

*Solid, liquid, gaseous biomass, biogenic share of w aste, landfill and sew age gas;
StrEG: Act on the Sale of Electricity to the Grid; BauGB: Constuction Code; EEG:Renew able Energy Sources Act;
Electricity from geothermal energy is not presented due to the negligible quantities of electricity produced;



Strcture of electricity Germany, 2008 in DE II
from renewable energy sources in
supply
Total: 91.4 TWh
Wind energy
44.3 %

Photovoltaics
4.4 %

Biogenic solid fuels
11.4 %

Hydropower Biogenic liquid fuels
22.9 % 1.6 %
Biogas
Sewage gas 7.7 %
Biogenic share 1.2 %
of waste
5.4 % Landfill gas
1.1 %
Total biomass*: Approx. 29 %

*Solid, liquid, gaseous biomass, biogenic share of w aste, landfill and sew age gas



RES-E in Czech Republic 2008
• Preferred grid access; el. distributor obliged to buy
• Feed-in tariffs or green premium + selling on grey market
• Wind
– FIT: 2460 Kc/MWh (~93 €/MWh) for 20 years
– premium: 1870 Kc/MWh (~70 €/MWh)
• Solar PV
– FIT: 13460 Kc/MWh (~506 €/MWh) for 20 years
– premium: 12650 Kc/MWh (~476 €/MWh)
• biomass combusion plants
– FIT : 2430-4210 Kc/MWh (91-158 €/MWh) and is guaranteed for 20 years.
– premium: 1150-2930 Kc/MWh (43-110 €/MWh)
• Biomass co-firing or parallel-firing: only premium
– Green premiums for co-firing: 240 - 1390 Kc/MWh (9-52 €/MWh)
– Green premiums for parallel firing: 500 - 1650 Kc/Mh (19-62 €/MWh)


News I - Turkey

• Feed-in law in preparation; implementation
expected for this summer
• Green field PV
– 280 €/MWh for 10 years; 220 €/MWh for following 10
years
• PV on buildings
– Monthly electricity generation up to 3000 kWh: 450
€/MWh
– Up to 6000 kWh: 350 €/MWh


News II – Canada-Ontario
• New feed-in law expected
for this summer
Technology Proposed size tranches €/MWhe
Biomass* Any size 72
Biogas* <5 MW 87
> 5 MW 62
Hydropower* <50 MW 77
Community Based <2 MW 80
Landfill gas* <5MW 66
> 5 MW 61
Solar PV Rooftop <10 kW 476
10 - 100 kW 424
100 - 500 kW 377
> 500 kW 320
Ground Mounted . <10 MW 263
Wind Onshore Any size 80
Offshore Any size 113
Community Based . <10 MW 86


International development:
EU RE-Road Map
• binding targets for 2020:
– 20% RE share (primary energy)
– 20% energy efficiency increase
– 20-30% CO2 reduction
• How to reach 20% RE target? Sectoral projections (EREC):
– 35 – 40% RE electricity share
– min 25% RE heat share (!!!)
– min 12% RE fuels share (!)
• Energy efficiency complementary (!)


RES-E Projection ...2020

Source: EU DG TREN


The future of policy?
•Harmonisation across EU long-term goal, but premature
today
•Full harmonisation could be based on either feed-in or quota
•Important to first implement best practice in RES-E policy
design and remove barriers
•Optimisation and coordination of policy between Member
States desirable

Thank you for your attention!

More information…

Frank Schillig, f.schillig@ecofys.com
Director International Business Development
Solar & Bioenergy


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