Promotion systems for electricity from renewable energy sources Lessons learned from EU countries. Reinhard Haas. Vienna University of Technology

Transcription

1 Promotion systems for electricity from renewable energy sources Lessons learned from EU countries Reinhard Haas Vienna University of Technology 1

2 SURVEY 1. Introduction 2. Historical developments 3. Success of strategies 4. The success story of PV 5. Effects on electricity markets 6. Conclusions 2

3 1 INTRODUCTION CORE MOTIVATION: Policy targets for an INCREASE of RES-E! e.g. 2020/20/20/20 targets RES-E directive: increase share of RES-E from 12% 1997 to 22% in 2010) 3

4 Electricity generation [TWh/a] RES-E EU : 12% 2. HISTORY 2009: 17% Large-scale hydro Small-scale hydro 'New' RES-E excl. hydro 4

5 Stromerzeugung [TWh/a] ELECTRICITY GENERATION FROM NEW RENEWABLES 250 IN EUROPE Geothermie Photovoltaik Biomüll Biogas Biomasse (fest) Wind (Offshore) Wind (Onshore) 2009: 7 % : 1 %

6 REMARK ON RES DEPLOYMENT IN THE EU-COUNTRIES Since about 1997 triggered by EUdirectives and EU initiatives Yet, specific country success stories very strongly related to national policies design! 6

7 3. SUCCESS OF STRATEGIES 7

8 Costs (EUR/ kw) (=efficiency) SUCCESS CRITERIA FOR STRATEGIES Major objectives: MW /Number of plants (=effectiveness) increase the amount of electricity from renewables and reduce costs! 8

9 Value of certificate (c/kwh) PRICES OF CERTIFICATES Italy, UK; Belgium: Continuous high level! Sweden: Shortage in banked certificates! Sweden UK Belgium (average) Italy Poland Romania 10

10 cent/kwh LEVEL OF FEED-IN TARIFFS AT DE ES

11 Value of certificate (c/kwh) cent/kwh 14 TRADABLE CERTIFICATES SUPPORT LEVELS: COMPARISON 14 FEED-IN TARIFFS AT DE ES Sw eden UK Belgium (average) Italy Poland Romania

12 EFFECTIVENESS VS COSTS 13

13 METHOD OF APPROACH: STATIC COST RESOURCE CURVES EUR/ kwh Predicted e.g small Hydro Uncertainty e. g. Wind e.g. biomass cofiring more expensive capacities cheapest capacities kwh 14

14 HOW FEED-IN TARIFFS WORK EURO/ kwh Costs P Fix kwh Q Out? 15

15 Total costs for customers EURO/ kwh (PREMIUM) FEED-IN TARIFFS Total costs = Producer surplus C + Additional generation costs P FIT_C P FIT_B P FIT_A A B Cost curve Market price Target kwh 16

16 HOW QUOTA-BASED TRADABLE G O - CERTIFICATES WORK EURO/ kwh Costs P Zert? kwh QUOTA 17

17 EURO/ kwh Total costs for customers TRADABLE G O CERTIFICATES Total costs = Producer surplus C + Additional generation costs P CERT B A Cost curve Market price Target kwh 18

18 TRADABLE GREEN CERTIFICATES EURO/ kwh Producer surplus Extra generation costs risk premium!!! Market price Minimal Monetary generation costs kwh Total costs Quota/ Target 19

19 Generation Cost [ /MWh ele ] THE SHAPE OF THE COST CURVE E U - 27 Producer surplus Marginal cost for RES-E Producer Surplus Cost-resource curve (RES-E in the EU27) Additional generation costs Total Electricity market price Power price Required RES-E deployment Required RES-E deployment costs Additional (up to 2020) realisable potential for RES-E [TWh] 20

20 THE CASE OF SWEDEN 21

21 CONCLUSIONS (1) To ensure significant RES-E deployment in the long-term, it is essential to promote a broad portfolio of different technologies IMPROVE/OPTIMIZE THE CURRENT SYSTEMS A well-designed FIT provides RES-E-deployment fastest and at lowest costs; BEFORE HARMONISING Strategies with lower (financial) risk -> less profit requirements -> lower costs for society. OR IMPLEMENTING MAJOR CHANGES! A European- wide trading system would lead to a much higher burden for European citizens than a comparable FIT for meeting the 2020/20%RES target! 22

22 4. THE SUCCESS STORY OF PHOTOVOLTAIC DEPLOYMENT (IN GERMANY) 23

23 PV increases in recent years in Europe Germany Spain Czech Republic Italy 24

24 25 Source: EPIA (2012) Total installed capacity 2011: 27.7 GW (compared to 16.6 GW in 2010)

25 Costs of and FIT for PV Costs FIT Germany 26

26 PV: cumulative development in Central Europe In Germany in 2011/2012: PV contributes at peak production times to about 25% of load! 27

27 Installierte Leistung (MW) SINCE 2000: INVESTMENTS MAINLY IN RENEWABLES! PV WIND 2020: ca MW PV Thermisch Atomkraft Wassser Wind PV 28

28 5. EFFECTS OF PROMOTING RES-E ON ELECTRICITY MARKETS 29

29 Costs (EUR/MWh) LONG-TERM MARGINAL COSTS Cheapest: Nat. Gas Nuclear Wind 30 Capital costs Operation/Fuel costs CO2 costs

30 Costs (EUR/MWh) SHORT-TERM MARGINAL COSTS Cheapest: Nat. gas Nuclear Wind Operation/Fuel costs CO2 costs 31

31 Long-term vs shortterm marginal costs 32

32 Costs,Price (EUR/MWh) ON-PEAK NICE SUMMER DAY: PRICE = SHORT-TERM MARGINAL COSTS Demand D t e.g. Coal old What happens, if PV capacity will double? e.g. Natural gas new p t2 Price = System -marginal costs Nuclear Supply curve PV Wind Hydro 35 MW

33 IMPACT OF PV ON THE ELECTRICITY MARKET PRICE IN GERMANY Photovoltaics On-peak time: Low electricity prices! Spot market price electricity Germany 36

34 RES Production > Demand Supply and Demand Electricity price = high! Demand RES Production < Demand Electricity price = 0 (or negative) 37

35 PV costs vs household electricity price in Germany Upper and lower corridor! Grid parity? 38

36 [c/kwh] Share on household electricity prices Electricity prices of households Capital costs Operation& Labour costs Fuel costs Profits of companies

37 Structure household electricity prices Fuel costs decrease Capital costs increase 40

38 [c/kwh] Share on household electricity prices Electricity prices of households Non-regulated share Regulated share

39 6. Conclusions (i) well-designed (dynamic) Feed-in tariff certain deployment of PV fastest and at lowest costs for society correct dynamic design! (ii) Overheating destroyed other markets (Czech Republic, Spain, Italy(?) ); (iii) Looming grid-parity for PV? change to investment subsidies? (v) New market design will emerge (vi) New pricing mechanisms for end users (vii) Regulated share on electricity prices will increase 42

40 INTERESTED IN FURTHER INFORMATION? Download reports from: www. eeg. tuwien. ac. at to: tuwien. ac.at 43

41 THE CASE OF SWEDEN Major characteristics: * since 2002: quota-based system of Tradable Certificates * also old capacity allowed to fulfill quota * additional investment subs. for wind! 44

42 [cent/kwh] SWEDEN: IMPACT OF INVESTMENT SUBSIDIES P cert_th Wind Loc. A Costs (Supply curve) Wind Loc. B Invest. Subsidies for wind cert_act Biomass Quota [GWh/year] 45

43 PRICES OF CERTIFICATES IN SWEDEN 46

44 Costs of PV in next years (EUR/kWp) Increased competition due to modules from China Market clearing Over capacities