Green public procurement of electricity

Transcription

1 Green public procurement of electricity Results of study on possible GPP criteria for RES-E Joß Bracker, Dominik Seebach GPP Advisory Group Meeting Dublin, 4/5 April 2017

2 Project Background Service contract for the support of DG ENER and DG ENV for an update of the green public procurement criteria Aug 2015 Feb 2017 Project partners: Öko-Institut e.v. (project coordinator) ICLEI Local Governments for Sustainability, European Secretariat imug Beratungsgesellschaft mbh 2

3 Overview Background of green electricity procurement Challenges for GPP of RES-E Requirements for additionality Status quo of GPP of green electricity Proposed GPP criteria Conclusions 3

4 Background of green electricity procurement Electricity consumption plays a vital role in the EU climate strategy 27% of GHG emissions in the EU come from the power sector EU goal: - 40% GHG emission by 2030, 20% RES share by 2020 Public procurement as important instrument to reach EU climate targets EU public authorities account for 6-7% of electricity consumption Goal: Contribute directly to expansion to RES-E production and take a leading role for other consumers in green consumption 4

5 Purchase of RES-E: Guarantees of Origin (GO) generation consumption "copper plate" "electricity lake physical power flow Source: E-TRACK Project 5

6 Purchase of RES-E: Guarantees of Origin (GO) generation consumption copper plate physical power flow Tracking linkages Source: E-TRACK Project GO are the main tracking instrument for RES-E implemented based on Art. 15 RES Directive Standardized and flexible instrument allowing for provision of green products at low transaction costs; independent markets from electricity trading contracts Well-developed GO system and RES-E market in most European countries 6

7 Challenges for GPP of RES-E Well-developed green power markets exist in many member states, but demand from end consumers for RES-E is smaller than the current RES-E generation Market situation leads to an oversupply of RES-E certificates Consuming green power often only takes RES-E away from other consumer groups that express no particular demand for RES-E This is demonstrated by extremely low wholesale market prices for Guarantees of Origin for RES-E (approx ct/mwh this corresponds to ~1 % of the value of physical electricity) Support for additional RES-E generation is much more costly and the development of new RES-E technologies (e.g. wind and solar) is almost entirely driven by governmental support schemes (e.g. prices in Sweden/Norway of about 20 EUR/MWh) 7

8 Challenges for GPP of RES-E If public authorities buy green energy their consumption will be met with renewable energy, but there is usually no increase in RES-E generation and thus very limited environmental benefit from a system perspective. If consumers (limited) willingness to pay is distributed over all RES-E, this will generate windfall profits for the cheapest RES-E (old hydro), but not be sufficient to stimulate new RES-E. Stimulation of RES-E generation through simple consumer demand for RES-E is not realistic. In addition, oversupply will continue or even rise due to rising RES-E production in the EU. Main challenge is to ensure that purchasing of RES-E leads to environmental benefit through additionality criteria. 8

9 Requirements for Additionality General principle: Additionality is an added environmental benefit related to a specific green product or supplier Environmental benefits possible in different dimensions: Additional RES-E production Better ecological standards (sustainable biomass, fish ladders, etc.) Other (e.g. intelligent integration of variable solar and wind production) Ecological standards are very context-dependent and therefore very plant-specific, in addition European-wide verification is very difficult Focus on additional RES-E production is considered most relevant for MS to reach climate targets and is relatively easy to verify 9

10 Requirements for Additionality Different models how additionality could be achieved Supplier model : Purchasing (unsupported) electricity generation from new power plants with a maximum age. GO from new plants are more expensive than from old installations. Recommended e.g. by the German Federal Environment Agency Guidelines for RES-E GPP "Funds model : Requiring investment of a part of the money paid under the contract to new generation capacities 10

11 Status Quo of GPP of electricity: Survey results Background: Current EU GPP criteria Core criteria: Min. 50% RES-E/ CHP Comprehensive criteria: 100% RES-E Verification based on GO or other equivalent proof Procurement of RES-E often done in MS with well-developed electricity markets. Legal framework and quasi-monopoly situation of electricity suppliers and consequently the non-availability of effective RES-E offers limit the purchase RES-E in several MS. Only in a few cases RES-E procurement takes additionality criteria into account at all, often due to a lack of understanding of the relevance of specific additionality criteria. 11

12 Potential European GPP criteria: Option I Core Criteria 100% RES-E Use of GO as tracking instrument Minimum shares of electricity from new plants Stimulates the expansion of RES-E generation through market pressure for continuous investments in new RES-E plants and contributes to long-term financing of new RES-E plants. Comprehensive criteria all core criteria + exclusion of supported production Increases RES-E generation on top of business-as-usual scenario expected by public support schemes Price considerations: Price surplus of below 1% (core criteria) and 6% (comprehensive criteria) 12

13 Proposed GPP criteria: Option II Core Criteria 100% RES-E Use of GO as tracking instrument Minimum share of electricity from to be built plants also stimulates the expansion of RES-E generation, but has a stronger link between consumption and additional new plants requires suppliers to purchase electricity from brand new RES power plants that have not been in operation before the start of the contract or to invest in new RES-E plants themselves. Comprehensive criteria all core criteria + exclusion of supported production Increases the RES-E generation on top of business-as-usual scenario expected by public support schemes Price considerations: Price surplus of below 1% (core criteria) and 2% (comprehensive criteria) 13

14 Conclusions Current EU GPP guidelines have very limited additional RES-E production effect and thus do lead to limited environmental benefits Environmental criteria for RES-E with additionality exist and are common in the voluntary green electricity market (e.g. various labels / standards in several MS). Additional costs are acceptable. But: Diverging views on legal eligibility of proposed GPP criteria Public authorities can also contribute to RES-E development by other means than electricity procurement (e.g. improvements in energy efficiency, direct investment RES-E plants, administrative support for the development of RES-E). 14

15 Your contact Dominik Seebach Project coordinator Phone: Joß Bracker Researcher Presenter: Robert Kaukewitsch European Commission, DG Environment Telefon: Öko-Institut e.v. P.O. Box Freiburg, Germany 15

16 Thank you for your attention! Do you have any questions??