New market rules for renewables: looking up to 2030

Transcription

1 The Future of the Electricity System New market rules for renewables: looking up to 2030 Brussels, July 4,

2 Overall framework The European Council of 23 and 24 October 2014 endorsed 3 targets for 2030: 1. A binding EU target of at least 40% reduction in greenhouse gas emissions. 2. A binding EU target of at least 27% of renewable energy consumed in the EU. 3. An indicative EU target of at least 27% for improving energy efficiency. The European Commission then made sensitivity tests for various options, using models such as PRIMES. The Commission finally decided that the most suitable political option would include a binding EU target of 30% for energy efficiency. In order to avoid free riding by some Member States, the Commission proposes governance rules which come close to national binding targets. 2

3 Consequences Impact of a higher target regarding energy efficiency, according to PRIMES: 1 Need of a pro-active policy regarding energy efficiency: 2 Significant divergence in the results by 2030: 3

4 Financial provisions The Commission wants to reform the wholesale electricity market, which will have to provide producers with the bulk of their income. Draft measures include: All market participants on equal footing and responsible for imbalances Trading close to real time with settlement periods of 15 minutes New bidding zones Abolition of maximum limit for the wholesale electricity price Nevertheless, financial support will remain essential until This support is governed by the guidelines on State Aids issued by DG COMP. 4

5 Networks charges According to the rules, charges shall reflect actual costs. Questions to be addressed: Connection charges & locational signal: size of the zone, voltage level, duration of the charge Use of networks: injection charge, fixed charge ( /period), capacity charge ( /kw), volumetric charge ( /kwh), tariff for self-consumers. System operation: RES to provide energy services such as primary or secondary reserves, not yet fit for frequency and voltage control, main parameters for the quality of electricity. 5

6 Power Capacity by 2030 RES capacity will increase by 80%; wind capacity will double while solar capacity will be multiplied by a factor 2.4. Total installed capacity will increase by 17%. Installed wind and solar capacity will exceed conventional capacity. 6

7 Power Generation by 2030 Total generation will increase by 5%, when total installed capacity increases by 17%, reflecting a drop of the overall load factor. RES generation will amount at 49% of total, with wind 20% and solar 9% of total output. 7

8 Discrepancies in RES capacity RES development for the whole of the EU masks deep inequalities among MS. The Commission hopes that a deep harmonization, ranging from market rules to administrative formalities, can reduce the existing discrepancies. Simulations show that the catch-up will not take place over the decade. RES Power Capacity in selected Member States: 8

9 Self-Consumption Consumers are encouraged to generate electricity from renewable sources either individually or through an energy community. Priority dispatch is granted up to 500 kw and can be transferred to an aggregator. Self-consumption will remain unaffordable for large sections of the population, due to insufficient saving capacity or inadequate housing. Network tariffs, taxes and levies shall be carefully designed to avoid any increase of their bill linked with self-consumption. 9

10 Final messages The Clean Energy package is accompanied by a promise of beneficial economic effects and new jobs. The Clean Energy Package will most likely stimulate service-oriented activities (aggregators, data processing, storage management, etc.). Additional measures should be taken to ensure that: The EU industry does not find itself in an unfavourable situation vis-à-vis foreign competitors with specific government support. Jobs are not all concentrated in the already well-off regions. Specific schemes are designed for the retraining of workers from conventional sectors. 10

11 More information in the study (soon available in English): Comments & Questions are welcome 11

12 Sources Slide 3: PRIMES, Technical report on Member State results of the EUCO policy scenarios, By E3MLab & IIASA, December 2016, pages 70 et 71. SWD(2016)-418, European Commission, Impact Assessment accompanying the proposal of a directive on the promotion of the use of energy from renewable sources (recast), third part, pages 253 & 254. Slides 6, 7 and 8: PRIMES, Technical report on Member State results of the EUCO policy scenarios, By E3MLab & IIASA, December 2016, pages 74 to 127. Slide 9: COM (2016)-767, Proposal of a directive on the promotion of the use of energy from renewable sources (recast), articles 21 &