The European Commission s renewable energy proposal

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1 The European Commission s renewable energy proposal 11/13/08 EUROPEAN COMMISSION Tom Howes, European Commission

2 Renewable energy promotion since 1997 National targets for RE electricity since 2001 National targets for RE in transport since 2003 Policy background sustainability world leadership in halting climate change security of supply oil supply & prices, gas worries, rising global demand, driven by TRANSPORT competitiveness supporting an innovative industrial sector where we are world leaders and face a fast growing export market Public discussion launched with the 2007 energy package: in 2020, widely discussed with the public, with stakeholders and NGOs, governments and parliaments across Europe. Broadly endorsed by Member States (European Council) and Parliament

3 European Commission proposals 23/01/08: An assessment of national Energy Efficiency Action Plans A new EU emissions trading scheme with a European (not national) cap, auctioning of allowances: to generate reductions in GHG of 21% New national targets to achieve a 10% GHG reduction in non ETS sectors A framework to promote the development of CO 2 capture and storage New guidelines on state aid for environmental protection New directive to reach the 20% renewable energy target and 10% biofuels target

4 The impacts + Reduce annual CO 2 emissions by between Mt, + reduce annual fossil fuel demand by 250 Mtoe and + promote Europe s leading industrial and technological role ( 20 billion turnover and jobs) costs range from 10.6bn - 18bn p.a. for the EU depending on oil price assumptions, financing, technology mix, and competition in the market (BUT the costs of renewable energy technology continue to fall substantially)

5 The international dimension Renewable energy is a priority in most EU institutions EIB, EBRD, R&D funding, development funding (GEEREF) A range of acronyms to choose from: The EU Energy Initiative (EUEI) The Renewable Energy and Energy Efficiency Partnership (REEEP) The Mediterranean Renewable Energy Partnership (MEDREP) The Global Village Energy Partnership (GVEP) Basel Agency for Sustainable Energy (BASE)

6 The renewables Directive 1. Sets mandatory national targets for renewable energy shares, including 10% biofuels share, in Requires national action plans 3. Flexibility provided by standardised guarantees of origin (certifying the renewable origin of electricity or heat) and enables the transfer of these to provide flexibility to Member States 4. Requires reduction of administrative and regulatory barriers, improvements in provision of information and training and improves renewables access to the electricity grid 5. Creates a sustainability regime for biofuels

7 EU-27 efforts in Renewables: RES share in 2005 BE BG CZ DK DE EE IE EL ES FR IT CY LV LT LU HU MT NL AT PL PT RO SI SK FI SE UK 2.2% 9.4% 6.1% 5.8% 3.1% 6.9% 8.7% 10.3% 5.2% 2.9% 0.9% 4.3% 0% 2.4% 7.2% 6.7% 1.3% 17.0% 18.0% 15% 20.5% 17.8% 16% 23.3% 28.5% 34.9% 39.8% RES share in 2005

8 EU-27 efforts in Renewables: flat rate increase BE BG CZ DK DE EE IE EL ES FR IT CY LV LT LU HU MT NL AT PL PT RO SI SK FI SE UK 2.2% 9.4% 6.1% 17.0% 5.8% 18.0% 3.1% 6.9% 8.7% 10.3% 5.2% 2.9% 15% % 0% 2.4% 7.2% 23.3% 20.5% 17.8% 16% 6.7% % 34.9% 39.8% RES share in 2005 Flat rate increase of

9 EU-27 efforts in Renewables: GDP weighted increase BE BG CZ DK DE EE IE EL ES FR IT CY LV LT LU HU MT NL AT PL PT RO SI SK FI SE UK 2.2% 9.4% 5.3% 1.1% 6.1% 2.6% 17.0% 5.8% 6.7% 18% 2.4% 3.1% 7.4% 6.9% 5.6% 8.7% 5.8% 10.3% 7.2% 5.2% 6.3% 2.9% 4.6% 15% 2.5% 0.9% 4.6% 4.3% 3.2% 0% 4.5% 2.4% 6.1% 23.3% 7.2% 2.3% 20.5% 17.8% 2% 16% 3.5% 6.7% 1.8 % 28.5% 1.3% 8.2% 9.1% 5% 34.9% 5.2% 4% 39.8% 1.6% 5.6% RES share in 2005 Flat rate increase of Additional effort based on GDP per capita EU-27

10 EU-27 efforts in Renewables: target setting method BE BG CZ DK DE EE IE EL ES FR IT CY LV LT LU HU MT NL AT PL PT RO SI SK FI SE UK 2.2% 9.4% 6.1% 5.3% 1.1% % 17.0% 7.5% 9.1% 5.8% 6.7% 18% % 3.1% 7.4% 6.9% 5.6% 8.7% 5.8% 10.3% 7.2% 5.2% 6.3% 2.9% 4.6% 15% 2.5% 0.9% 4.6% 4.3% 3.2% 0% 4.5% 2.4% 6.1% 23.3% 7.2% 2.3% 20.5% 5% 17.8% 0.7 2% 16% 3.5% 6.7% 1.8 % 28.5% 1.3% 8.2% 34.9% 5.2% 4% 39.8% 1.6% 5.6% 4.7% RES share in 2005 Flat rate increase of Additional effort weighted by GDP per capita Figures adjusted by early starter bonus EU-27

11 EU-27 efforts in Renewables BE BG CZ DK DE EE IE EL ES FR IT CY LV LT LU HU MT NL AT PL PT RO SI SK FI SE UK 10% 11% 13% 16% 13% 18% 16% 18% 20% 17% 13% 13% 14% 15% 14% 15% 25% 23% 23% 24% 25% 30% 31% 34% 38% 42% 49% RES share in 2020 Current Discussions: no serious alternative

12 Flexibility No sectoral targets Large projects clause Force majeure Guarantees of origin certifying the renewable origin of electricity or heat Based on Dir. 2001/77/EC. Member States may transfer extra GOs to other Member States, or producers may transfer GOs from new installations to other Member States and with third countries gives the flexibility to meet national targets by developing cheaper renewable energy in other Member States Current discussions: GO flexibility replaced by simpler virtual statistical transfers of RE between Member States, joint projects including with third countries

13 Other elements of the directive National action plans Sectoral targets & measures established by Member States Facilitates monitoring of the directive and provides stability for investment Current discussions: template in Directive and format by Commission Administrative reforms to remove barriers simplification and streamlined procedures, RES in the planning process minimum levels of renewable energy in building codes certification regimes for installers; mutual recognition Current discussions: templates, degree of detail Electricity grid issues Priority access (c.f. Dir. 2001/77/EC), review of cost sharing rules Current discussions: grid security remains crucial

14 Promotion of biofuels Sustainability criteria for biofuels : GHG savings minimum of 35% No raw material from sensitive areas (old forest, grasslands, protected areas) No conversion of wetlands and continuously forested areas EU biofuels must meet cross compliance environmental rules Consequences of not meeting the criteria: Don t count towards targets; no public support/tax breaks Member States to give a bonus in their biofuel obligations to biofuels from wastes, residues, cellulosic and lignocellulosic material Current discussions: indirect land use, food prices reviews

15 Timing 2007: Wide policy discussion 2008: the legislative process: amendments of Council and Parliament 2009: adoption of the whole package in Spring biomass sustainability to come Conclusion o Renewables are a necessary part of any sustainable energy policy o They re an integral part of climate policy, part of development and trade policy, of competition policy.. even of agricultural policy all of which is clearly demonstrated by the Commission s package approach

16 Thank you for your attention