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Communication from the Commission
ENERGY FOR THE FUTURE:
RENEWABLE SOURCES OF ENERGY
White Paper for a Community Strategy and Action Plan
COM(97)599 final (26/11/97)
TABLE OF CONTENTS
1. Setting the Scene
1. The General Framework
1. Introduction
2. The Current Situation
3. The Need for a Community Strategy
2. The Debate on the Green Paper
3. Strategic Goals
1. An Ambitious Target for the Union
2. Member States Targets and Strategies
3. Possible Growth of RES by Sector
4. Preliminary Assessment of some of the costs and benefits
2. Main Features of the Action Plan
1. Introduction
2. Internal Market Measures
1. Fair Access for Renewable to the Electricity Market
2. Fiscal and Finance Measures
3. New Bioenergy Initiative for Transport, Heat and
Electricity
4. Improving building regulations : its impact on town and
country planning
3. Reinforcing Community Policies
1. Environment
2. Growth, Competitiveness and Employment
3. Competition and State Aid
4. Research, Technology, Development and Demonstration
5. Regional Policy
6. Common Agricultural Policy and Rural Development Policy
7. External Relations
4. Strengthening co-operation between Member States
5. Support Measures
1. Targeted promotion
2. Market Acceptability and Consumer Protection
3. Better positioning for RES on the institutional banks
and commercial finance market
4. Renewable Energy Networking
3. Campaign for take-off
1. Introduction
2. Key Actions
1. 1.000.000 photovoltaic systems
2. 10.000 MW of large wind farms
3. 10.000 Mwth of biomass installations
4. Integration of Renewable Energies in 100 Communities
3. Estimates of some of the costs and benefits
4. Follow-up and Implementation
1. Implementation and Monitoring of Progress
2. Internal Co-ordination of E.U. Policies and Programmes
3. Implementation by Member States and Co-operation at EU level
4. Implementation of Action Plan - Next Steps
ANNEXES
1. Preliminary Indicative Action Plan for RES 1998-2010
2. Estimated Contributions by Sector - A scenario for 2010
1. Biomass
2. Hydro Power
3. Wind Energy
4. Solar Thermal
5. Photovoltaics
6. Passive Solar
7. Geothermal and Heat Pumps
8. Other Renewable Technologies
9. Achieving the Overall Community Objective for RES
10. Estimated RES contributions in Electricity and Heat
generation
11. Assessment of some of the costs and benefits
3. Member States plans and actions for RES development
TABLES
* 1.Share of Renewable Energy Sources in Gross Inland Energy
Consumption
* 1A.Estimated contributions by Sector in the 2010 scenario
* 2.Current and Projected Future Gross Renewable Energy Consumption
(Mtoe) for 2010
* 3.Current and Projected Electricity Production by RES for 2010
* 4.Current and Projected Heat Production (Mtoe) for 2010
* 5.Estimated Investment costs and benefits of the overallStrategy
in the 2010 scenario
* 6.Estimated Investment costs and benefits by sector
Chapter 1 Setting the Scene
The General Framework
Introduction
Renewable sources of energy are currently unevenly and insufficiently
exploited in the European Union. Although many of them are abundantly
available, and the real economic potential considerable, renewable
sources of energy make a disappointingly small contribution of less
than 6% to the Union's overall gross inland energy consumption, which
is predicted to grow steadily in the future. A joint effort both at
the Community and Members States' level is needed to meet this
challenge. Unless the Community succeeds in supplying a significantly
higher share of its energy demand from renewables over the next
decade, an important development opportunity will be missed and at the
same time, it will become increasingly difficult to comply with its
commitments both at European and international level as regards
environmental protection.
Renewable energy sources are indigenous, and can therefore contribute
to reducing dependency on energy imports and increasing security of
supply. Development of renewable energy sources can actively
contribute to job creation, predominantly among the small and medium
sized enterprises which are so central to the Community economic
fabric, and indeed themselves form the majority in the various
renewable energy sectors. Deployment of renewables can be a key
feature in regional development with the aim of achieving greater
social and economic cohesion within the Community.
The expected growth in energy consumption in many third countries, in
Asia, Latin America and Africa, which to a large extent can be
satisfied using renewable energies, offers promising business
opportunities for European Union industries, which in many areas are
world leaders as regards renewable energy technologies. The modular
character of most renewable technologies allows gradual
implementation, which is easier to finance and allows rapid scale-up
where required. Finally, the general public favours development of
renewables more than any other source of energy, very largely for
environmental reasons.
The Current Situation
Five years after the Rio Conference, Climate Change is again at the
centre of international debate in view of the upcoming "Third
Conference of the Parties to the United Nations Framework Convention
on Climate Change" to be held in Kyoto in December 1997. The European
Union has recognised the urgent need to tackle the climate change
issue. It has also adopted a negotiating position of 15% greenhouse
gas emissions reduction target for industrialised countries by the
year 2010 from the 1990 level. To facilitate the Member States
achieving this objective, the Commission, in its communication on the
Energy Dimension of Climate Change identified a series of energy
actions - including a prominent role for renewables.
The Council of Ministers endorsed this when inviting the Commission to
prepare an action programme and present a strategy for renewable
energy. In preparation for the international climate change conference
in Kyoto, the Commission confirmed the technical feasibility and
economic manageability of the Union's negotiating mandate. In a recent
Communication, the Commission analysed the consequences of reducing
CO2 emissions significantly, including the implications for the energy
sector. In order to achieve such a reduction, the Union will require
major energy policy decisions, focusing on reducing energy and carbon
intensity. Accelerating the penetration of renewable energy sources
isvery important for reducing carbon intensity and hence CO2
emissions, whatever the precise outcome of the Kyoto Conference.
The EU's dependence on energy imports is already 50% and is expected
to rise over the coming years if no action is taken, reaching 70% by
2020. This is especially true for oil and gas which will increasingly
come from sources at greater distances from the Union, often with
certain geopolitical risks attached. Attention will therefore
increasingly focus on security of supply. Renewable energies as
indigenous sources of energy will have an important role to play in
reducing the level of energy imports with positive implications for
balance of trade and security of supply.
Much progress has been achieved towards completion of the Internal
Energy Market. Agreement has been reached in the Council of Ministers
on the first phase of liberalisation of the electricity sector and
negotiations in the gas sector are well under way. Opening the markets
for the network-bound energies will bring market forces into play in
sectors which until recently were for the most part dominated by
monopolies. This will provide a challenging new environment for
renewable energies, providing more opportunities but also posing the
challenge of a very cost-competitive environment. Suitable
accompanying measures are needed in order to foster the development of
renewables.
Renewable energy sources still make an unacceptably modest
contribution to the Community's energy balance as compared with the
available technical potential. There are signs, however, that this is
changing, albeit slowly. The resource base is better understood, the
technologies are improving steadily, attitudes towards their uses are
changing, and the renewable energy manufacturing and service
industries are maturing. But renewables still have difficulties in
"taking off", in marketing terms. In fact many renewable technologies
need little effort to become competitive. Moreover, biomass, including
energy crops, wind and solar energy all offer a large unexploited
technical potential.
Current trends show that considerable technological progress related
to renewable energy technologies has been achieved over recent years.
Costs are rapidly dropping and many renewables, under the right
conditions, have reached or are approaching economic viability. The
first signs of large-scale implementation are also appearing as
regards wind energy and solar thermal collectors. Some technologies,
in particular biomass, small hydro and wind, are currently competitive
and economically viable in particular compared to other decentralised
applications. Solar photovoltaics, although characterised by rapidly
declining costs, remain more dependent on favourable conditions. Solar
water heaters are currently competitive in many regions of the Union.
Under prevailing economic conditions, a serious obstacle to greater
use of certain renewables has been higher initial investment costs.
Although comparative costs for many renewables are becoming less
disadvantageous, in certain cases quite markedly, their use is still
hampered in many situations by higher initial investment costs as
compared with conventional fuel cycles (although operational fuel
costs are non-existent for renewables with the exception of biomass).
This is particularly the case due to the fact that energy prices for
conventional fuel cycles do not currently reflect the objective full
cost, including the external cost to society of environmental damage
caused by their use. A further obstacle is that renewable energy
technologies, as is the case for many other innovative technologies,
suffer from initial lack of confidence on the part of investors,
governments and users, caused by lack of familiarity with their
technical and economic potential and a general resistance to change
and new ideas.
Globally, Europe is at the forefront for several renewable energy
technologies. Significant employment is associated with the industries
concerned in the European Union, involving several hundred companies,
mainly small and medium-sized enterprises, in primary
assembling/manufacturing alone, without taking into account other
service and supply needs. For the new renewable energy technologies
(i.e. not including large hydro-electric power stations and the
traditional use of biomass) the world-wide annual turnover of the
industry is estimated to be higher than ECU 5 billion, of which Europe
has more than a one third share.
The Need for a Community Strategy
Development of renewable energy has for some time been a central aim
of Community energy policy, and as early as 1986 the Council listed
the promotion of renewable energy sources among its energy objectives.
Significant technological progress has been achieved since then thanks
to the various Community RTD and demonstration programmes such as
JOULE- THERMIE, INCO and FAIR which not only helped in creating a
European renewable energy industry in all sectors of renewables but
also in achieving a world-wide leading position. This technological
leadership will be maintained by the contribution of the 5th RTD
framework programme in which the renewable energy technologies will
have a central role to play. With the ALTENER programme , the Council
for the first time adopted a specific financial instrument for
renewables promotion. The European Parliament for its part has
constantly underlined the role of renewable energy sources and in a
recent Resolution strongly advocated a Community action plan to
advance them. In its White Paper, "An Energy Policy for the European
Union" the Commission put forward its views as regards Community
energy policy objectives and instruments to achieve them. Three key
energy policy objectives were identified, viz. improved
competitiveness, security of supply, and protection of the
environment. Promotion of renewables is identified as an important
factor to achieve these aims. A strategy for renewable energy sources
was proposed, and specifically cited in the 'indicative work
programme' attached to the Energy Policy White Paper.
At the same time some Member States have introduced some measures to
support RES and related programmes. Some have set up plans and targets
aimed at developing RES in the medium and long term. The share of
renewable energies in the gross inland energy consumption differs
widely between Member States, from less than 1% to over 25% (see table
1). A Community strategy will provide the necessary framework and
bring added value to national initiatives increasing the overall
impact.
A comprehensive strategy for renewables has become essential for a
number of reasons. First and foremost, without a coherent and
transparent strategy and an ambitious overall objective for renewables
penetration, these sources of energy will not make major inroads into
the Community energy balance. Technological progress by itself can not
break down the several non-technical barriers which hamper the
penetration of renewable energy technologies in the energy markets. At
present, prices for most classical fuels are relatively stable at
historically low levels and thus in themselves militate against
recourse to renewables. This situation clearly calls for policy
measures to redress the balance in support of the fundamental
environmental and security responsibilities referred to above. Without
a clear and comprehensive strategy accompanied by legislative
measures, their development will be retarded. A long-term stable
framework for the development of renewable sources of energy, covering
political, legislative, administrative, economic and marketing aspects
is in fact the top priority for the economic operators involved in
their development. Furthermore, as the internal market develops, a
Community-wide strategy for renewables is required to avoid imbalances
between Member States or distortion of energy markets. The leading
position of the European renewable energy industry world-wide can only
be maintained and strengthened on the basis of a significant and
growing home market.
A policy for the promotion of renewables requires across-the-board
initiatives encompassing a wide range of policies: energy,
environment, employment, taxation, competition, research,
technological development and demonstration, agriculture, regional and
external relations policies. A central aim of a strategy for renewable
energy will be to ensure that the need to promote these energy sources
is recognised in new policy initiatives, as well as in full
implementation of existing policies, in all of the above areas. In
fact, a comprehensive action plan is required to ensure the necessary
co-ordination and consistency in implementing these policies at
Community, national and local levels.
The role of Members States in the implementation of the Action Plan is
crucial. They need to decide on their own specific objectives witin
the wider framework, and develop their own national strategies to
achieve them. The measures proposed in this White Paper must also be
adapted to the particular socio-economic, environmental, energy and
geographic situation of each Member State as well as to the technical
and physical potential of RES in each Member State.
With a view to illustrating the potential effects of specific policy
initiatives in the renewable energy field, the Commission sponsored an
exercise referred to as TERES. The TERES II study builds on one of the
scenarios previously developed in the Commission's European Energy to
2020 report but goes further by adding various specific renewable
energy policy assumptions to form three additional scenarios. These
scenarios predict the contribution of renewable energy sources to
gross inland energy consumption to be between 9.9% and 12.5% by 2010.
The technical potential, however, is much larger.
The various scenarios clearly illustrate that renewable energy sources
can make a significant contribution to the energy supply of the
European Union. On the other hand the renewable energy component of
the energy mix is very sensitive to changing policy assumptions.
Unless specific incentives are put in place, the large potential for
renewable energy will not be exploited and these sources will not make
a sufficient contribution to the European energy balance.
The Debate on the Green Paper
As a first step towards a strategy for renewable energy the Commission
adopted a Green Paper on 20 November 1996 A broad public debate took
place during the early part of 1997 focusing on the type and nature of
priority measures that could be undertaken at Community and Member
States' levels. The Green Paper has elicited many reactions from the
Community institutions, Member States' governments and agencies, and
numerous companies and associations interested in renewables. The
Commission organised two conferences during this consultation period
where the issues were extensively discussed.
The Community Institutions have delivered detailed comments on the
Green Paper as well as opinions on what should be the essential
elements and the major actions to be undertaken for a future Community
strategy on renewable energy sources and the role of the Community in
this process. The Council in its Resolution on the Green Paper,
affirms that adequate action on renewables is vital for achieving
sustainable economic growth, the aim being a strategy that would lead
to improved competitiveness and a substantial share of renewables in
the long term. Thus, it confirms that Member States and the Community
should formulate indicative targets as a guideline for this ambitious
indicative target of doubling the overall share of renewable in the
Community by 2010. The Council Resolution states that such a
comprehensive strategy should be based on certain basic priorities:
harmonisation of standards concerning renewables, appropriate
regulatory measures to stimulate the market, investment aid in
appropriate cases, dissemination of information to increase market
confidence with specific actions to increase customer choice. It also
takes the view that adequate provision for the support for renewables
in the Fifth Framework Programme for Research, Technological
Development and Demonstration is required, as well as effective
co-ordination and monitoring of progress in order to optimise
available resources.
The European Parliament in its Resolution on the Green Paper
recognises the important role that renewable energy can play in
combating the greenhouse effect, in contributing to the security of
energy supplies and in creating jobs in small and medium enterprises
and rural regions. It believes that the European Union urgently needs
a promotion strategy which will tackle the issues of tax
harmonisation, environmental protection and standards, internalisation
of external costs, and ensure that the gradual liberalisation of the
internal energy market will not place renewables at a disadvantage. It
proposes a goal of a 15% share of renewables for the European Union by
the year 2010. It calls on the Commission to submit specific measures
to facilitate the large-scale use of renewable energy sources and
advocates certain specific measures. These include the setting of
targets per Member State, the concept of a common energy-related tax
model, free non-discriminatory access to the grid combined with a
minimum payment by the utilities for the electricity supplied from
renewable energies, the main features of a plan to establish a
European fund for renewable energies, a strategy for a common
programme to promote renewable energies to include a further 1,000,000
photovoltaic roofs, 15,000 MW of wind and 1,000 MW of energy from
biomass.
Parliament's Resolution also calls for a buildings directive, a plan
for greater use of structural funds, a strategy for the better
utilisation of agricultural and forestry biomass and an export
strategy for renewable energy technologies. It reaffirms its belief in
the need to increase the Community budgetary appropriations in support
of renewable energy sources to the level currently used for nuclear
research. It also proposes the constitution of a new Treaty for the
promotion of renewable energy sources. The Committee on Agriculture
and Rural Development of the Parliament has also issued an Opinion in
which it considers that the contribution of biomass-derived energy to
the primary energy mix could reach 10% by 2010. It also calls for a
better co-ordination of European Union energy policy and the common
agricultural policy and emphasises the need to make the necessary
arable land available under the latter.
The Economic and Social Committee and the Committee of the Regions
have also presented detailed comments on all chapters of the Green
Paper, which also stress, analyse, and support the overall goals
relating to sustainability and the different ways the potential
contribution of renewables can be maximised. Furthermore, these
contributions set out ways in which the role and responsibilities of
regional and local public authorities and other bodies could be best
harnessed to facilitate renewables support and market penetration.
Given the predominantly decentralised implementation of most renewable
technologies, practical measures in this direction would allow
recourse to the subsidiarity principle, in the framework of a
Community Strategy and Action Plan, facilitating local authorities in
their decision-making power and environmental responsibility.
Moreover, this context is a prime example where energy policy aims and
those of structural and regional policy can synergise with one another
to great effect, as illustrated by the case of rural, island, or
otherwise isolated communities where sustainable development and the
maintenance of a population base can be actively supported by
replacement of inefficient small-scale fossil fuel use by renewables
plants. That leads to better living standards and job creation.
More than 70 detailed written reactions have been received from Member
State agencies, industries, professional associations, regional
associations, institutes and non-governmental organisations following
the publication of the Green Paper. The extensive public debate on the
Green Paper and the many contributions received have provided valuable
input for the Commission in drafting this White Paper and in proposing
the Action Plan.
Strategic Goals
An Ambitious Target for the Union
In the Green Paper on Renewables the Commission sought views on the
setting of an indicative objective of 12% for the contribution by
renewable sources of energy to the European Union's gross inland
energy consumption by 2010. The overwhelmingly positive response
received during the consultation process has confirmed the
Commission's view that an indicative target is a good policy tool,
giving a clear political signal and impetus to action. The strategy
and action plan in this White Paper therefore, are directed towards
the goal of achieving a 12% penetration of renewables in the Union by
2010 - an ambitious but realistic objective. Given the overall
importance of significantly increasing the share of RES in the Union,
this indicative objective is considered as an important minimum
objective to maintain, whatever the precise binding commitments for
CO2 emission reduction may finally be. However, it is also important
to monitor progress and maintain the option of reviewing this
strategic goal if necessary.
The calculations of increase in RES needed to meet the indicative
objective of 12% share in the Union's energy mix by 2010 is based on
the projected energy use in the pre-Kyoto scenario (conventional
wisdom, European Energy to 2020, see footnote 8) It is likely that the
projected overall energy use in the EU 15 may decrease by 2010 if the
necessary energy saving measures are taken post Kyoto. At the same
time, the enlargement of the Union to new Member States where RES are
almost non-existent will require an even greater overall increase. It
is therefore considered at this stage, that the 12% overall objective
cannot be refined further. It is in any case, to be emphasised that
this overall objective, is a political, and not a legally binding
tool.
Member States Targets and Strategies
The overall EU target of doubling the share of renewables to 12%by
2010 implies that Member States have to encourage the increase of RES
according to their own potential. Targets in each Member State could
stimulate the effort towards increased exploitation of the available
potential and could be an important instrument for attaining CO2
emission reduction, decreasing energy dependence, developing national
industry and creating jobs. It is important, therefore, that each
Member State should define its own strategy and within it propose its
own contribution to the overall 2010 objective, indicate the way it
expects different technologies to contribute and outline the measures
it intends to introduce to achieve enhanced deployment.
Nevertheless, it should be emphasised that both the Community and the
Member States have to build on existing measures and strategies, as
well as tackle new initiatives. Some Member States have developed
national Plans for RES and set objectives for 2010, 2020 or even 2030.
Annex III outlines the plans and actions of Member States for
renewables development. Member States are indeed already making
efforts to develop RES and the Community Strategy will provide a
framework to encourage those efforts and to ensure their
cross-fertilisation. Action at the level of the Community can provide
added value in terms of the sharing and transfer of successful
technological and market experiences.
Possible Growth of RES by Sector
Achievement of the average 12% overall indicative objective for the
Union clearly depends on the success and growth of the various
individual renewable technologies. Views expressed during the
consultation process on the Green Paper confirmed that it is important
to analyse how the overall objective can be achieved by a contribution
from each sector, and hence to estimate the contribution each
renewable source is likely to make. The potential sectoral growth of
RES suggested in this Strategy has to be considered as a first attempt
to identify a possible combination of renewable technologies that
could allow the EU to reach the overall target, within technical,
practical and economic limitations. However, renewable energy
technologies may well evolve differently, depending on many factors,
including market developments, options chosen by Members States and
technical developments. The estimate share of different technologies
are clearly indicative and will serve to help monitor progress and
ensure that each technology makes its optimal contribution, within a
clear policy framework.
The current share of renewables in the energy mix of approximately 6%
includes large-scale hydro, for which the potential for further
exploitation in the European Union, for environmental reasons, is very
limited. This means that the increases in the use of other renewables
will have to be all the more substantial.
In Annex II a set of indicative estimated contributions from each
renewable energy source as well as for each market sector are
outlined, as a projection of one way in which the overall desired
growth of RES can be achieved. According to the particular, scenario
outlined, the main contribution of RES growth (90 Mtoe) could come
from biomass, tripling the current level of this source. Wind energy,
with a contribution of 40 GW is likely to have the second most
important increase. Significant increases in the solar thermal
collectors (with a contribution of 100 million m2 installed by 2010)
are also anticipated. Smaller contributions are foreseen from
photovoltaics (3 GWp), geothermal energy (1 GWe and 2.5 GWth) and heat
pumps (2.5 GWth). Hydro power will probably remain the second most
important renewable source, but with a relatively small future
increase (13 GW), keeping its overall contribution at today's level.
Finally, passive solar could have a major contribution in reducing the
heating and cooling energy demand in buildings. A 10% contribution in
this sector, representing fuel savings of 35 Mtoe, is considered
feasible. If the sectoral growth outlined in the scenario is achieved
then the overall doubling of the current share of renewables can be
achieved, as shown in the tables in Annex II. As far as the market
sectors are concerned, the doubling of the current electricity and
heat production from renewables plus a significant increase of biofuel
in transport fuel use by 2010 are important elements in the scenario
for achieving the overall Union objective.
Preliminary Assessment of some of the Costs and Benefits
In order to assess the feasibility of achieving the overall Community
objective, the necessary costs have to be estimated. Equally
important, however, is the estimation of the related benefits. The
doubling of the current market penetration of renewable energies by
2010 will have beneficial effects among others in terms of CO2
emissions; security of supply and employment. In table 6 of Annex II
the estimated investment costs required to achieve the target together
with the estimated benefits are presented. The total capital
investment needed to achieve the overall target is estimated at 165
billion ECU for the period 1997-2010. What is more relevant, however,
is the net investment which is estimated at 95 billion ECU. However,
it must be underlined that there are very significant avoided fuel
costs.
In table 5 of Annex II these figures are compared with the total
investment of the energy sector for the same period, as projected by
the Conventional Wisdom scenario of the "European Energy to 2020"
study of the Commission. If we consider that in this scenario an
amount for investments in renewable energies is already included, the
additional net investment needed if the action plan is to have its
full effect is then equal to 74 billion ECU. In the same table, it can
be seen that the doubling of the share of renewables may require an
increase of approximately 30% in the total energy sector investment
but it could create an estimated gross figure of 500,000 - 900,000 new
jobs, save annually (in 2010) 3 billion ECU in fuel costs and a total
of 21 billion ECU for the period 1997-2010, reduce the imported fuels
by 17.4% and the CO2 emissions by 402 million tonnes/year by 2010.
This amount of CO2 savings represents a significant contribution
towards the CO2 reduction needed to successfully combat climate
change. The calculation of the figures in the table needs some
clarification. In the recent Communication from the Commission
"Climate Change - the EU approach to Kyoto" it is estimated that the
800 million tonnes CO2 emission reduction potential can be achieved
with an annual compliance cost of 15 to 35 billion ECU and with a
total (primary and secondary) benefit which might range from 15 to 137
billion ECU per year. From the analysis presented in Annex II, it is
shown that doubling the share of renewables can reduce the CO2
emissions by 402 million tonnes per year with respect to 1997. This
corresponds to an additional reduction possibility of 250 million
tonnes of CO2 with respect to the 2010 "business as usual" Pre-Kyoto
scenario used in the Climate Change Communication and one third of the
expected CO2 reduction target. The difference between figures (402 and
250) is due to the fact that in the scenario for 2010, an increase of
30 Mtoe in the use of renewable between 1995-2010 is assumed which
corresponds approximately to annual savings of 150 million tonnes of
CO2 by 2010. Therefore, the estimates of CO2 emission reduction from
RES cited in this White Paper results from a technical assessment and
represents the full expected reduction from a doubling of the current
share of RES, whereas in the policy communication on Kyoto, the figure
cited is the additional reduction in CO2 emissions to be attained to
reach a specific reduction target, over and above what may have been
attained under the specific Conventional Wisdom pre-Kyoto scenario for
2010.
Net employment figures in the renewable energy sector are difficult to
predict and calculate. Real figures exist in the sectors that have
reached a certain level of development. Wind energy, for example, has
already created more than 30,000 jobs in Europe. Each renewable energy
technology has its own characteristics as far as the quality and the
kind of employment generated. Biomass has the particularity of
creating large numbers of jobs for the production of raw material.
Photovoltaics creates a large number of operational and maintenance
jobs, since PV installations are small and dispersed. Hydro is not
expected to create more jobs than those already existing in Europe.
Detailed estimations of net employment have been made in the TERES II
study using the SAFIRE market penetration model developed under the
JOULE II programme. The model predicts for 2010 a net employment of
500,000 jobs directly created in the renewable energy sector and
indirectly in the sectors that supply the sector. This is a net figure
allowing for losses of jobs in other energy sectors. Sectorial studies
performed mainly by the industry give much larger employment figures.
The European Wind Energy Association (EWEA) estimates that the jobs to
be created in 2010 by the wind sector will be between 190,000 and
320,000, if 40 GW of wind power is installed. The European
Photovoltaic Industry Association (EPIA) estimates that a 3 GWp
installed power in 2010 will create approximately 100,000 jobs in the
PV sector. The European Biomass Association (AEBIOM) believes that the
Biomass employment figures in the TERES II study are underestimated
and that employment in the sector will increase by up to 1,000,000
jobs by 2010 if the biomass potential is fully exploited. The European
Solar Industry Federation (ESIF) estimates that 250,000 jobs will be
created in order to meet the solar collector 2010 market objective.
While it is not possible to reach any hard conclusions as is the
likely cumulative level of job creation which would derive from
investments in the various forms of renewable energy sources, it is
quite clear that a pro-active move towards such energy sources will
lead to significant new employment opportunities.
An important additional economic benefit not included above is the
potential growth of the European renewable energy industry in
international markets. In most technical areas, European industry in
this field is second to none in its ability to provide the equipment
and technical, financial and planning services required for market
growth. This offers therefore, significant business opportunities for
exports and possibilities for expansion of the European renewable
technologies industry. A 17 billion ECU annual export business is
projected for 2010, creating potentially as many as 350.000 additional
jobs.
Considering all the important benefits of renewables on employment,
fuel import reduction and increased security of supply, export, local
and regional development, etc. as well as the major environmental
benefits, it can be concluded that the Community Strategy and Action
Plan for renewable energy sources as they are presented in this White
Paper are of major importance for the Union as we enter the 21st
century.
Chapter 2 Main Features of the Action Plan
Introduction
Without a determined and co-ordinated effort to mobilise the Union's
renewable energies potential, this potential will not be realised to a
significant extent, resulting in missed opportunity to develop this
sector and to reduce greenhouse gas emissions significantly. If
pro-active steps are not taken in a co-ordinated way within the Union,
renewable energies are only likely to emerge slowly from today's niche
markets to become more widely used and hence fully cost competitive in
around 2020, with full market penetration perhaps still years beyond.
The Action Plan set out below aims at providing fair market
opportunities for renewable energies without excessive financial
burdens. Increasing the current share of renewables significantly will
not be an easy task, but the benefits to be obtained justify a major
effort.
Investments will have to made made both by the private and public
sectors, but these will provide multiple dividends as Europe's
industry and service companies demonstrate their technological
leadership in a globally competitive market. At the same time, the
increasingly liberalised and globalised energy markets present a new
situation, which will have to be used in a positive sense to provide
new opportunities, while new obstacles to RES growth in the
electricity sector will have to be avoided.
The Community Strategy and Action Plan should be seen as an integrated
whole, to be further developed and implemented in close cooperation
between the Member States and the Commission. The challenge facing us
requires a concerted and co-ordinated effort by the various players
over time. Measures should be taken at the appropriate level according
to the subsidiarity principle within the coordinated framework
provided by this Strategy and Action Plan. It would be incorrect and
unrealistic to assume that actions need only be taken at Community
level. The Member States have a key role to play in taking the
responsibility to promote Renewables, through national action plans,
to introduce the measures necessary to promote a significant increase
in renewables penetration, and to implement this strategy and Action
Plan in order to achieve the national and European objectives.
Legislative action will only be taken at EU level when measures at
national level would be insufficient or inappropriate and when
harmonisation is required across the EU. The Strategy and Action Plan
must be flexible and be updated over time in the light of experience
gained and new developments including international commitments
undertaken to reduce CO2 emissions. For this reason, a system of
continuous review is proposed.(see section 4.1. below).
Internal Market Measures
The following is a list of priority measures aimed at overcoming
obstacles and redressing the balance in favour of renewables, in order
to reach the indicative objective of 12% penetration by 2010.
Fair Access for Renewables to the Electricity Market
Electricity is the single most important energy sector as it accounts
for about 40% of gross energy consumption in the EU15. Access for
renewables to the electricity networks at fair prices is therefore a
critical step for their development. The basis for a Community legal
framework largely exists and its implementation will have to provide
for the necessary degree of legislative harmonisation. Experience of
liberalisation elsewhere has shown that it can form the basis for a
dynamic and secure role for renewables so long as adequate
market-based instruments are provided.
At present Member States are transposing the internal market in
electricity Directive into national law. The Directive, in Article
8(3), permits Member States to require electricity from renewable
sources to be given preference in dispatching. Further schemes for the
promotion of renewables may also be compatible with the Directive,
pursuant to Article 3 and/or Article 24. Most or all Member States are
planning to include such schemes in their transposition of the
Directive. The Commission is examining closely the different schemes
proposed or introduced by the Member States in order to propose a
Directive which will provide a harmonised framework for Member States
to ensure that renewable energies make up a sufficient contribution to
overall electricity supply, both at the EU and at national level.
Different preference schemes for electricity from renewables will be
considered in this context.
Such an approach is an important element towards the creation of a
true single market for electricity. Where significant differences
exist between Member States regarding the extent to which renewable
energy is supported and, possibly, the manner in which any consequent
support measures are financed, this may result in significant trade
distortions not related to efficiency.
Other issues to be addressed will include the following :
* the way in which transmission system operators should accept
renewable electricity when offered to them, subject to provisions
on transport in the internal market in electricity Directive;
* the guidelines on the price to be paid to a generator from
renewable sources which should at least be equal to the avoided
cost of electricity on a low voltage grid of a distributor plus a
premium reflecting the renewables' social and environmental
benefits and the manner in which it is financed : tax breaks,
etc.;
* on which categories of electricity purchases such measures fall;
* with regard to network access, avoiding discrimination between
electricity produced from solar radiation, biomass (below 20 MWe),
hydroenergy (below 10 MWe) and wind.
Fiscal and Finance measures
The environmental benefits of renewable energies justify favourable
financing conditions. The so-called "Green tariffs" already offered in
certain Member States by appealing to voluntary environmental
solidarity on the part of those consumers - domestic or corporate -
able and willing to pay higher rates are not sufficient, nor
appropriate in all cases.
The Commission has already made or will make the necessary additional
proposals for legislation and amendments to existing Directives before
the end of 1998, including tax exemption or reduction on RES energy
products on behalf of Member States "prerogatives" under art. 13 to 16
of the proposed Directive "Restructuring the Community Framework for
the Taxation of Energy Products";
In some cases it will be appropriate and sufficient for Member States'
authorities to enact the necessary legislation or other provisions, in
areas such as
* flexible depreciation of renewable energies investments;
* favourable tax treatment for third party financing of renewable
energies;
* start up subsidies for new productions plants, SME's and new job
creation.
+ financial incentives for consumers to purchase RE equipment
and services;
The Commission however will also make a survey of the progress made
throughout the Union in this regard by the end of the year 2000, and
if this indicates a remaining need for Union-level measures in certain
of the areas listed, the necessary proposals will be put forward.
Other financial measures, which are proving their value in some Member
States, will also be examined and promoted more widely as appropriate
such as:
* so-called "golden" or 'green' funds addressed to capital markets.
Such funds are financed from private bank accounts which in this
case attract lower interest rates. The margin consented by the
lower interest rate paid to the account holder is passed on by the
bank to the renewable energies investor in the form of discount
rates;
* public renewable energy funds, managed by regulated agencies. The
facilities offered could include revolving funds as well as credit
guarantees (renewable energies bonds) and should in any case
conform to the Treaty provisions;
* soft loans and special facilities from institutional banks (see
Section 2.5.3)
New Bioenergy Initiative for Transport, Heat and Electricity
Specific measures are needed in order to help increase the market
share for liquid biofuels from the current 0.3% to a significantly
higher percentage, in collaboration with Member States.. The overall
environmental effect varies from biofuel to biofuel and depends,
amongst others, on the crop cultivated and the crops replaced.
Promotion of biofuels has to be coherent with the AutoOil Programme
and the European policy on fuel quality, and should take account of
the full cycle of environmental costs/benefits. The role of biofuels
in the clean fuel specification for 2005 and beyond is being studied
under the Auto Oil II project.
Two new directives, currently under negotiation, concerning transport
fuel and sulphur reduction in liquid fuels already include provisions
encouraging the use of biofuels for transport, i.e. alcohols and ETBE,
vegetable oils and esters for biodiesel.
Given the fact that currently the production cost of liquid biofuel is
three times that of conventional fuels, a priority effort needs to be
placed on further research and other measures to reduce production
costs of biofuels. An increased use of liquid biofuels at present can
only be obtained if there is a high rate of tax relief and subsidised
raw material production. Detaxation of biofuels is currently made on a
limited scale, in the framework of the directive 92/81 on
harmonisation of the structures of excise duties, allowing such
detaxation on a pilot scale. The Commission proposes that a
market-share of 2% for liquid biofuels could still be considered a
pilot phase. This level may well be reached in the short or medium
term in some countries (in particular Austria, Germany, France and
Italy). The Commission has already made proposals for adjusting the
relevant European legislation in order to allow a large scale liquid
biofuels detaxation.
For biogas promotion, production of landfill gas or biogas from the
food industry or farms will be encouraged, in order to obtain with
energy and environmental policy benefits. Fair access to the
electricity market will be promoted as indicated in point 2.2.1.
above. Measures for biogas will contribute to the achievement of the
Commission's strategy on reducing methane emissions from manure by
using anaerobic digesters or covered lagoons as well as meeting the
objectives on protection of waters and on landfill.
It is proposed under this strategy that demonstration programmes at
European Union, national, regional and local level should be supported
to install recovery and use systems for intensive rearing. In
addition, the Commission will examine the possibility of integrating
biogas actions in the structural funds.
In order for the markets for solid biomass to be further developed,
the following must be actively promoted:
* co-firing or fossil fuel substitution in coal power plants and in
existing district heating networks;
* new district heating or cooling networks as an outlet for
co-generation with biomass;
* greater access to upgraded fuels such as chips and pellets and a
more intensive exploitation of appropriate forest, wood and paper
industry residues;
* new scaled up IGCC (Integrated Gasification in Combined Cycle)
systems in the capacity range of 25-50 Mwe based on a mixture of
biomass and waste derived fuels;
* Clean energy generation from municipal waste either by thermal
treatment, landfill gas recovery or anaerobic digestion as long as
energy generation from waste complements and does not replace
waste prevention and recycling.
The Commission has recently published a strategy to promote combined
heat and power. CHP is of paramount importance for the success of
biomass implementation. Almost 1/3 of the new additional biomass
exploitation by 2010 could fall in this category. District heating and
cooling is also vital to maximise the financial and economic benefits
of cogeneration. Increased use of bioelectricity is linked, like that
for wind and solar electricity, to European Union wide measures for
fair access to the electricity market (see Section 2.2.1).
Improving building regulations: its impact on town and country
planning
Energy consumption in the domestic and service sectors can be
significantly reduced by improving energy intensity overall in
addition to more use - in retrofitting as well as for new buildings -
of renewables such as solar energy. It is important to adopt a global
approach and to integrate measures of rational use of energy (for the
building envelope as well as for heating, lighting, ventilation and
cooling) with the use of renewable energy technologies. Total energy
consumption in this sector could be reduced by 50% in the European
Union by 2010, half of which could be accounted for by introducing
passive and active solar technologies in buildings for which concrete
promotional measures are necessary. This could be facilitated by
amendments to the existing Directives on improving energy efficiency
in buildings and to the Directive on building materials in order to
include new building materials for solar efficiency in the standards
specifications.
In order to promote the use of RES in buildings, the following
specific measures are proposed:
* incorporation of requirements on the use of solar energy for
heating and cooling in building approvals under current
legislative, administrative and other provisions on town and
country planning should be considered;
* promotion of high efficiency windows and solar facades, natural
ventilation and window blinds in new buildings and for
retrofitting;
* promotion of active solar energy systems for space heating and
cooling and warm water, e.g. solar collectors, geothermal heating
and heat pumps;
* promotion of passive solar energy for heating and cooling;
* encouragement of PV systems to be integrated in building
construction (roofs, facades) and in public spaces;
* photovoltaic electricity sales to utilities from private customers
should be priced so as to allow direct reversible metering;
* measures to encourage the use of construction materials with a low
intrinsic energy content, e.g. timber.
Reinforcing Community Policies
The priority given to renewable energies in existing Community
policies, programmes and budgets is mostly very low. There is much
scope for reinforcement. It is also important to make the renewable
energies potential better known and to increase awareness among all
those bearing responsibility for Community programmes.
Environment
The Fifth Environmental Action Plan gives due consideration to
renewable energies and proposes support measures including fiscal
incentives The measures in the Fifth Environmental Action Plan
referring to renewable energies, will be implemented by the year 2000,
within the overall framework of the strategy proposed in this White
Paper. The net environmental effects of different renewable energy
sources will be taken into account when implementing different
measures.
It is important to underline that a significant increase in the share
of renewable energy sources will play a key role in meeting the
Union's CO2 emission reduction objectives, in parallel to efforts for
energy efficiency and other areas. Measures related to climate change
will take into account the Community Strategy on RES.
Growth, Competitiveness and Employment
The Commission's White Paper on Growth, Competitiveness and Employment
constitutes an important point of reference for further action on
renewable energies There is indeed a great potential for renewable
energies to contribute to the aims set out in that White Paper.
Achieving the indicative objective of 12% in 2010 would lead to an
increase in the market for European Industry and could create a
significant number of new jobs as outlined in Section 1.4. The export
market is particularly important as Europe, with its traditional links
with Africa, South America, India and lately South-East Asia, is in a
very favourable position. The following actions deserve particular
attention:
* strengthening the competitive edge of European industry in the
global renewable energies market by supporting its ventures into
technological leadership and supporting development of a
substantive home market in addition to emerging export
opportunities;
* investigating opportunities for the creation of new SMEs and jobs;
* introducing RES issues in the actions addressed to SMEs under the
social fund;
* action for education and training relating to renewable energies
within existing Community programmes.
Competition and State Aid
In considering the various ways in which to promote the development of
renewable energy sources, the positive effects of competition should
be taken into account. In order to make renewables more competitive,
priority should be given to ways which let the market forces function
to bring down the costs for producing renewable energy as rapidly and
as far as possible.
When authorising State Aids, the Commission has to take into account
the derogations laid down in Article 92 of the Treaty. The guiding
principle for the Commission in assessing aid for renewable energies,
contained in the Community Guidelines on State Aid for Environmental
Protection is that the beneficial effects of such measures on the
environment must outweigh the distorting effects on competition. The
Commission will consider appropriate modifications in favour of
renewable energies in support of its policy in this area during the
revision of the present guidelines taking into consideration the
Council's Resolution on the Green Paper "Energy for the future :
renewable sources of energy" which states that investment aid for
renewables can, in appropriate cases, be authorised even when they
exceed the general levels of aid laid down in those guidelines.
Research, Technological, Development and Demonstration
It is generally recognised that there is still great scope for
Research, Technological Development and Demonstration to improve
technologies, reduce cost and gain user experience in demonstration
projects on condition that technological development is guided by
appropriate policy measures for introduction into internal and third
country markets and subsequent implementation.
Every kind of action, whether of a fiscal, financial, legal or other
nature, is addressed to facilitate the penetration of the technologies
into the market. The strategic goals presented under 1.3 above have to
be reached at the end by the use of renewable energy technologies, and
the role of RTD is to help the development of technologies which are
continuously more efficient.
As research, development and demonstration on renewable energies is
moving strongly into industrial development and higher cost intensity,
the financial means to be earmarked for renewable energy sources
should be increased significantly. The 4th Framework Programme for
Research, Technological Development and Demonstration and more
particularly the Non Nuclear Energy RTD programme is giving a priority
to Renewable Energies sources as they represent about 45% of its total
budget. The 5th Framework Programme should offer the possibility to
finance the necessary RTD efforts in this area. The specific programme
"Competitiveness and Sustainable Growth" which will be part of the 5th
Framework Programme, contains a key action on energy which indicates
clearly the important role of renewable energies and decentralised
production energy systems".
All RTD activities related to RES should take into account the present
Strategy and Action Plan, including the socio-economic aspects. The
complementarity between RTD on RES and RTD on other technologies
should also be encouraged. The role of RTD is important upstream of
the actions in the "Campaign for Take Off" described later in that it
should provide the cost efficient technologies to be used in this
Campaign.
Regional Policy
Renewable energies already feature to some extent in the European
Union's regional policy. In 1999 new guidelines for 2000-2007 will be
decided. The next multi-annual funds negotiation package will be the
occasion to extend, consolidate, and clarify the aid opportunities
available for renewable energies and above all to increase the weight
given to RES within the energy programmes. Decision-making criteria
must reflect the importance of renewables' potential for less favoured
regions (which are in general dependent on energy imports), peripheral
and remote areas, islands, rural areas, in particular those lacking
traditional energies. In those areas RES have a high potential for new
job creation, for the development of indigenous resources and
industrial and service activities (particularly in objective 1 areas).
The latter also applies to industrial areas under reconversion and
cities (future objective 2). New incentives should also be undertaken
in the tourism sector as the great potential of renewable energies in
this area is still largely unexplored.
The Community will give support to regional and local projects and
planning in the framework of its promotional programmes such as
ALTENER (see 2.5.1). However, it is essential to encourage the Member
States to include RES implementation plans in the programmes that they
will submit to the structural funds for co-financing (ERDF and
accompanying Community Support Frameworks), so that the share of RES
in energy programmes under the Objective 1 CSF could reach at least 12
%. This would reflect fully the objective set out in this White Paper
for renewable energy consumption by 2010. However, in order to
stimulate a shift towards renewable energy use so that this objective
can be reached at MS level, a considerably higher engagement of the
structural funds seems appropriate. Since the demand for funding for
RES projects has to be Member State driven, effort has to be put in
explaining the possibilities for RES funding and raising awareness on
their potential and benefits for the regions. Other programmes for
Objective 2 regions should also contribute to the promotion of RES.
It is important for the Commission to highlight that regional funds
invested in renewable energy sources development could contribute to
increased standards of living and income in less favoured, peripheral,
island, remote or declining regions in different ways :
* favouring the use of local resources and therefore indigenous
development;
* being usually labour intensive, they could contribute to the
creation of local permanent jobs;
* contributing to reduce the dependency on energy imports;
* reinforcing energy supply for local communities, green tourism,
preserved areas, etc.;
* contributing to develop the local R&TD and Innovation potential,
through the promotion of specific research-innovation projects
adapted to local needs.
The CSF sub-programmes for R&TD and innovation should also give
particular attention to projects aiming at the development of new
technologies and processes adapted to local and regional needs in the
areas of RES.
Common Agricultural policy and rural development policy
Agriculture is a key sector for the European strategy of doubling the
share of renewable energies in gross energy demand in the European
Union by 2010. New activities and new sources of income are emerging
on-farm and off-farm. Among those, the production of renewable raw
materials, for non-food purposes in niche markets or the energy
sector, can represent a new opportunity for agriculture and forestry
and contribute to job creation in rural areas
The reference in Agenda 2000 refers to the encouragement of renewable
energies. In particular biomass should be fully implemented using all
available policy instruments be they agricultural, fiscal or
industrial. In the future CAP alternative use for agricultural
products will be a major element. Member States should be encouraged,
in the context of the national aid regimes, to support renewable
energies.
Within the future rural development policy, the Commission will
encourage Member States and regions to give renewable energy projects
a high priority within their programmes for rural areas. However, the
regions will continue to have to assume their responsibility for the
selection of the projects.
The Common Agricultural Policy could contribute by supporting the
biomass energy sector to increase standards of living and income in
different ways :
* developing energy crops and utilising agricultural and forestry
residues as a reliable source of raw material, under the reformed
common agricultural policy, negotiated in accordance with Agenda
2000, making full use of the results of the research and
development policy;
* giving support for bio-based renewable energies under the rural
development policy and other ongoing programmes;
* supporting the regions by co-financing innovative, demonstrative
and transferable renewable energy projects, such as the
installation of combined solar, wind and biomass heat and
electricity production under a new Community initiative for rural
areas, as it is already possible within the existing LEADER
programme;
* applying the regulation 951/97 on processing and marketing of
agricultural products in relation to renewable energy products
wherever feasible;
the Commission will table a proposal enabling Member States to make
the granting of direct payments for arable crops and set-aside
conditional on the respect of environmental provisions, allowing them
to be increasingly used to pursue environmental objectives.
The existing possibilities under Regulation 2078/92 will be reviewed
in the context of Agenda 2000. In this context, programmes which
reduce environmental pressures from biomass-production and other uses
under the agri-environmental objectives should be developed. In
particular, schemes where energy crops are produced using reduced
water supply, low inputs, by organic methods or harvested in a way to
promote biodiversity etc could attract a premium. The Commission could
envisage more agri-environmental schemes being developed by national
authorities to support energy crops respecting the fact that
priorities for programmes would continue to be set by regional needs
and potentials.
On a European forestry strategy the European Parliament, in its
"Thomas Report" has called on the Commission to put forward a
legislative proposal. This report, inter alia, considers the need for
adding value to biomass through energy production including a wide
range of instruments. The report is currently under examination by the
Commission, and particular attention will be paid to this point.
Non food policy should also provide for support for energy uses of
agricultural products, by-products and short rotation forestry. The
Commission intends to examine the adequacy of existing instruments
particularly in the sense of the need to promote RES and to improve
further harmonisation. Some support is in fact already provided for in
the European legislation, such as 1586/97 (non food set aside)
Regulation 2080/92 (forest measures), 2078/92 (agro-environmental
measures) and 950/97 (improvement of efficiency in the agricultural
sector). Full use should be made of those existing Regulations.
External Relations
Information on and promotion of RES is important for third countries,
especially as they will also have to contribute to global CO2 emission
reductions. In that respect, it is important to promote RES in the
European assistance programmes, such as PHARE, TACIS, MEDA, the
European Development Fund and other Lomé Convention facilities, as
well as in all relevant co-operation and other agreements with
developing or industrialised third countries, taking into account the
possibilities and constraints of each programme. For PHARE and TACIS,
the promotion of renewable sources has to be considered in the context
of the economic and energy sector reform priorities of these
programmes.
A proactive co-operation and export policy to support renewable
energies will be stimulated, by enlarging the scope and basis of the
relevant European Union energy programmes such as SYNERGY, as well as
the Scientific and Technological Cooperation components of the 5th RTD
Framework Programme. The action list should include the following:
* support for co-operation on energy planning and integrated
resource planning with emerging economies, in order to optimise
exploitation of the available renewable energy potential;
* support for exporters, in the form of credit guarantees and
"currency turmoil" insurance and in the organisation of trade
missions, fairs, joint workshops etc.;
* collaboration in the implementation of the "Word Solar Programme
1996-2005" which intends to realize worldwide, and especially in
the developing countries, high priority regional and national
projects;
* cooperation with the international financing organisations such as
the World Bank and the Global Environment Facility GEF.
Special action concerning ACP Countries :
* a special initiative to promote solar electricity (photovoltaics
for deprived rural areas in third countries currently without
electricity);
* encourage increased use of alternative renewable energy sources to
resolve the problems caused by overconsumption of fuelwood in both
rural and urban areas of developing countries;
* encourage the development of suitable fuelwood species plantation;
* stepping up the ACP States' research and development activities as
regards the development of new and renewable energy sources;
Special action concerning associated countries:
* a special initiative to promote the process of approximation of
Community legislation on renewables in associated countries;
* implementation of Protocols concerning the participation of
associated countries in promotional EU programmes such as ALTENER;
* involving associated and third countries in demonstration
programmes under the 5th RTD Framework Programme, in addition to
specific energy policy programmes such as SYNERGY and ALTENER;
Strengthening co-operation between Member States
For successful implementation of the European Union Strategy and
Action Plan for renewable energies, effective co-operation between
Member States is of paramount importance. At present serious
discrepancies persist in levels of advancement both as regards
renewable energy implementation in the different Member States, and
between the technologies themselves. Co-operation within a Europe-wide
implementation strategy offers considerable added value to Member
States, as successful policies and experiences at national level can
be shared, and national renewables goals better co-ordinated, with the
result that the efficiency of overall policies as well as particular
projects will increase.
The Commission adopted on 4 October 1996 a proposal for a Council
Decision concerning the Organisation of Co-operation around Agreed
Community Energy Objectives. The draft decision identifies the
promotion of renewable energy resources as one of the agreed common
energy objectives and calls for supportive measures at both Community
and national levels with the aim of achieving a significant share of
renewables in primary energy production in the Community by 2010.
Concrete measures will be proposed as part of the implementation of
the Council Decision, once adopted.
Support Measures
Targeted Promotion
The ALTENER II programme, and the subsequent programme included in the
proposed Energy Framework Programme will have a crucial role to play
as the basic instrument for the Action plan.
ALTENER II will continue to support the development of sectoral market
strategies, standards and harmonisation. Support will be given to RES
planning at national, regional and local levels and to information and
education infrastructures. Support will also be given to the
development of new market and financial instruments. Dissemination of
information is also a major action in ALTENER II. In addition,
promotion of innovative and efficient renewable energy technologies
and dissemination of related information are also supported by
JOULE-THERMIE.
In order to enhance the impact of ALTENER II in RES market
penetration, new measures to help overcome obstacles and increase
operational capacity for the production of energy from RES have been
proposed. These actions will be targeted on assisting biomass, solar
thermal and PV, buildings, wind, small hydro and geothermal to
penetrate the market. Actions under ALTENER II will also be crucial
for the preparation of the Renewables Campaign for Take-off (see
chapter 3).
Monitoring the progress in the implementation of the RES Strategy in
Member States and in the Community will be critical and measures in
ALTENER II to support monitoring and evaluation are essential (see
chapter 4).
In order to achieve the objectives for renewables, a major effort will
be required to harness the potential, influence and experience of all
manner of associations and bodies such as citizens' groups
(grass-roots organisations), relevant non-governmental organisations,
and pressure-groups including the international environmental
protection organisations.
At local and regional level, the creation of energy agencies under the
SAVE II programme allows local authorities to play an important role
in the promotion of renewable energies, mobilising local partnerships,
focusing on practical actions and of becoming a key initiator of
policies at local level.
The setting up of effective networks is important in order to convey
information on renewables at all levels - from the technological to
the financial to the local public environmental concerns. A major
feature of the Commission effort in this area will be the use of
Internet websites.
Other public relations tools such as industry awards, renewable energy
prizes, conferences and other open events can and already do have a
strong promotional effect in the renewables field, but careful
selection in the allocation of support is essential to avoid
dispersion of effort.
Market Acceptability and Consumer Protection
The following actions are planned:
* consumer information on quality goods and services for renewable
energies. This information is to be disseminated in such a way
that customers can choose anywhere in the internal market the most
appropriate European product and source at the least price;
* standards should be established at European level but also at a
wider international level in order to support exports. Since
standardisation work in the renewables field started only in 1995,
an increased effort has to be made to extend standards to all
commercial equipment; provisional certification has also to be
promoted. The EU Joint Research Centre has an important role to
play in this respect, giving technical support to the CEN and
CENELEC in the framework of ALTENER;
* in order to respond to and mobilise the existing strong public
support for renewable energies, products should be clearly
labelled as such;
* best practice experience in particular for services, system
operation (a typical field for this is passive solar applications)
should be collected and widely disseminated;
* regional focal points for information and consumer advice should
be set up. The existing regional and city energy centres - and
those which continue to be set up under the SAVE II programme are
in most cases ideally situated and equipped to take on this role.
Better positioning for RES on the institutional banks and commercial
finance market
International financial institutions such as the EIB (incl. EIF etc.)
and the EBRD and their national counterparts have already become
involved in the financing of renewable energies, in particular hydro
and wind plants. Their role can be strengthened considerably by :
* providing soft loans and credit guarantees;
* creating special facilities for renewable energies;
* developing schemes facilitating loans for small renewable energy
projects.
Specific action focused on commercial banks will be promoted:
* guidelines and risk evaluation schemes to help banks to audit RES
businesses applying for loans;
* EU support to packaged projects in order to facilitate soft loans
access.
Renewable Energy Networking
Transnational co-operation in Europe is important in order to exchange
experience and to increase effectiveness. As the scale of renewable
energies implementation becomes more significant, the following
initiatives should be taken:
* networks of regions, islands, and cities aiming at a 100% energy
supply from renewable energies by 2010;
* networks of universities and schools pioneering renewable
energies;
* renewable energies technology research and technological
development networks;
* renewable energies twinning of cities, schools, farms etc.;
* temporary networks for specific tasks;
* the virtual centre "AGORES" for the collection and dissemination
of information on: regulation, calls for proposals, Community and
Member States programmes, technical state-of-art, training,
financing, assistance, etc.
Chapter 3 Campaign for take-off
Introduction
Even though renewable energy technologies have reached a certain
maturity, there are many obstacles to their market penetration.In
order to assist a real take off of renewables for large scale
penetration, make progress towards the objective of doubling the EU
renewable energy sources share by 2010, and ensure a co-ordinated
approach throughout the Community, the Commission proposes a campaign
for take off of renewables. This will need to be undertaken over a
number of years and will require close cooperation between the Member
States and the Commission. The proposed campaign aims to promote the
implementation of large-scale projects in different renewable energy
sectors and will send clear signals for greater use of renewable
energy sources. In preparation for the Campaign, the Commission will
catalogue and analyse all existing European Union and Member States'
activities and programmes which could provide support for such a
campaign. The conclusion of this preparatory survey will be reported
to Council and to the European Parliament. Detailed guidelines for the
campaign will then be drawn up, together with the Member States.
It is clear that the role of Member States is critical in this
concerted action for promoting large scale implementation of
renewables. The Commission's role will be to establish the framework,
to provide technical and financial assistance, where appropriate, and
to coordinate actions. For such a major effort to succeed, it is also
important to implicate all the interested parties and bodies in
promoting renewables through the means available to them. The
involvement of these actors can include the negotiation of commitments
and voluntary agreements where appropriate.
Many parties can be potentially active in a campaign to promote
renewables, including the following:
* the regions;
* municipalities and their distribution utilities;
* the oil and car industries;
* town and country planning bodies and architects;
* authorities in charge of public procurement;
* industry associations and utilities;
* farmers associations;
+ forest-based industries and cooperatives.
In the preparatory phase for the campaign, proposals will be made for
their involvement and contribution.
Key Actions
The following key actions are proposed to be promoted during the
campaign:
1,000,000 Photovoltaic Systems
Photovoltaics (PV) is a high technology with strong export potential
in a very competitive global market and fierce competition with Japan
and the USA. There is a very motivated PV industry in Europe which
should be supported in its effort to bring domestic and export markets
off the ground. Besides the leading European oil and other big
companies, many SMEs are active in the field. There is much scope for
their number to increase and for large numbers of jobs to be created.
An ambitious and very visible promotion campaign is needed in order to
provide a sufficiently large market base to enable the prices to fall
substantially, and so the Campaign will comprise an EU wide 500,000 PV
roof and façade initiative for the domestic market and an export
initiative for 500,000 PV village systems to kick start decentralised
electrification in developing countries. The basic capacity for each
of the systems (the integrated building systems in Europe as well as
the solar village schemes overseas), is 1kWe i.e. the total capacity
to be installed in this Campaign by 2010 is 1 GWp.
A large part of the future PV market will be associated with building
applications, especially in Europe where the electricity grid is
omnipresent . A 500,000 PV roof and facade campaign or the European
Union will represent, on the basis of 1kW generators, a total capacity
of 500 MWp and will make up one-sixth of the 3 GWp estimated
implementation potential outlined in Annex II. This is a very
significant campaign for the future of PV, even though it will affect
less than 2% of the 30 million houses and non-residential units which
will probably be built between now and 2010. This is without taking
into consideration the equally large potential for PV retrofitting in
existing buildings.
The rationale of such a goal in a global solar market is its
consistency with the corresponding goals fixed in Japan and the United
States. The first 1000 PV roof programme implemented in Germany at the
beginning of the 1990's proved highly successful for market
introduction of PV, quality assurance and cost improvements. Japan is
implementing in 1997 a 10,000 roof programme which is funded for
one-third from public sources. The total investment cost of a 500,000
roof programme would be 1.5 billion ECU (assuming 1kW generators at an
average price over the 13 year period of 3 ECU/W). On average, it
would mean approximately the installation of 40,000 systems per year.
Total yearly investment costs would then be 120 million ECU of which
one third i.e. 40 million ECU might be provided from public funds. The
equivalent amounts will be used for the export initiative. Although
there are virtually no regulations in place to promote PV in the
European Union, there is a wide spectrum of funding and fiscal
incentives for PV employed today. The most important ones are the 50 %
investment subsidy in some German Länder, Greece and other Member
States, a full cost electricity tariff for PV energy supplied to the
grid in some German cities and accelerated depreciation in the
Netherlands. A less generous support of one-third of the investment
cost from public funds which is currently applied in Japan may
actually be sufficient to open up the commercial markets.
This campaign should incorporate specific actions such as:
* promotion of photovoltaics in schools and other public buildings.
This action has not only an educational effect to increase
knowledge and awareness at an early and receptive age, but it is
technically sound as it minimises the need for storage capacity
and in many cases can benefit from advantageous financing;
* incentives for photovoltaics applications in tourism, and sports
and recreational facilities, which offers considerable potential
due to strongly peaking seasonal demand in mass tourism and the
fact that a large proportion of tourist sites are isolated and/or
mountainous or otherwise expensive to supply from grids;
* incentives for financing from public funds and city utilities, for
instance by spreading the extra cost for photovoltaics over the
entire customer base as opposed to the sole purchasers for solar
electricity.
10,000 MW of Large Wind Farms
Wind energy today is competitive and has already been widely installed
at specific sites with favourable conditions. Areas potentially
suitable for wind energy applications are dispersed throughout the
European Union. At present, some have to bear additional costs due to
their particular location which increases installation and/or
operational costs (areas far from existing grids, in very cold, hot or
dusty climates, offshore, islands, remote rural areas etc.). In
particular, there is enormous potential for offshore wind farms. They
have the advantage of higher wind speeds, although access is clearly
more difficult. In order to achieve large- scale penetration of wind
energy in the European Union these areas have also to be used. A
specific campaign is thus required to support large wind farms in such
locations and the development of such new or adapted technology as may
be appropriate. This programme will clearly imply a major role for the
utilities most concerned.
The 10,000 MW of wind farms proposed here represent 25% of the
feasible overall wind energy penetration for 2010 outlined in Annex
II. No public financing will be needed for the 30,000 MW remaining
installed capacity provided that a fair access to the European grids
for the wind turbines is guaranteed, as described in section 2.2.1. An
additional help is needed only for the less favourable or
unconventional applications described above.
The average ex-works cost of wind turbines for wind farms is today
less than 800 ECU/kW of installed capacity. Project preparation cost
depends heavily on local circumstances, such as condition of the soil,
road conditions, proximity to electrical grid sub-stations, etc. For
flat onshore sites the overall cost of an installed wind farm is about
1,000 ECU/kW. This cost could increase substantially for offshore and
unconventional site applications. On the other hand, costs are
expected to fall by at least 30% by 2010. It is then logical to assume
the total investment cost of the proposed 10,000 MW will be in the
order of 10 billion ECU. A public expenditure of 15% would amount to
1.5 billion ECU throughout the Union or a little more than 100 million
ECU per year.
10,000 MWth of biomass installations
Bioenergy is among the most promising areas within the biomass sector,
and combined heat and power using biomass has the greatest potential
in volume among all renewable energies. Consequently, a campaign to
promote and support decentralised biopower installations throughout
the European Union is essential. Such installations could range in
scale from a few hundred kW to multi-MW and combine different
technologies, as appropriate to local circumstances, including fuel
switching. Wherever possible use should be made of opportunities for
rationalisation through regional and local level implementation.
The estimated contribution of biomass in combined heat and power
plants, as outlined in Annex II.1, could be 26 Mtoe. This corresponds
typically to an overall installed capacity of approximately 20 GWe or
60 GWth. The promotion of 10 GWth through this campaign represents 1/6
of the total estimated contribution biomass could make by 2010. It
will in particular be important to take measures in the early years of
this action plan in order to launch a bioenergy market.
The total installation cost of such an initiative would be in the
order of 5 billion ECU, assuming an average cost of 500 ECU/kWth of
installed capacity. A public expenditure of 20% would amount to 1
billion ECU for the whole period for the whole Union or around 80
million ECU per year. The biomass feedstock cost would amount to 270
million ECU per year, if we assume a 100 ECU/toe.
Integration of Renewable Energies in 100 Communities
To optimise the available potential of renewable energy technologies
requires them to be used together wherever this is productive either
in integrated systems for local power supply or, on the other hand, in
dispersed schemes for regional power supply. These obviously have to
be adapted to the conditions of each specific location, so as to
ensure reliable power supply to the required quality and continuity
standards.
As part of this campaign action, a number of pilot communities,
regions, cities and islands will be selected from those which can
reasonably aim at 100% power supply from renewables. These pioneer
collectivities, in order to feature as credible pacemakers, should be
of varying size and characteristics. On a small scale, the units could
be blocks of buildings, new neighbourhoods in residential areas,
recreational areas, small rural areas, or isolated ones such as
islands or mountain communities. On a larger scale, "solar cities"
should be identified, as well as large rural areas, and administrative
regions which can benefit from an existing sense of community. arge
islands (e.g. Sicily, Sardinia, Crete, Rhodes, Mallorca, Canary
Islands or Madeira) could also be used as pilot regions.
In order to specify the actions required and to monitor progress, a
strategy including schedules, priorities and players must be defined.
Local and regional authorities as well as regional energy centres have
a central role to play in implementing this project.
Preference should be given to activities involving combinations of
technology and application in such a way that such projects have the
potential to cover the entire range from pre-feasibility study,
through feasibility study and demonstration phase (mainly programme
financed), to large-scale implementation with (mainly) commercial
international financing.
The costs of this initiative are difficult to define with any
precision at this stage due to the different size and nature of each
possible action. Projects implemented in other sectors of the present
campaign can also be a part of the actions promoted here. As a first
estimate one may assume a yearly cost of 200 million ECU, with a
public funding in the order of 20% or 40 million ECU per year
throughout the Union
Estimates of some of the costs and benefits
Cost estimates and an investment plan to be financed by all partners,
Community and Member States' programmes and funds and also by
institutional and commercial banks, utilities and others, will have to
be drawn up. The effects of this Campaign on CO2 emissions and
employment will also be analysed in detail. As a first estimate, the
Campaign could involve 20.5 billion ECU of investments for the period
1998-2010. Public funding from all possible sources (European,
national, regional, local), to stimulate the Campaign could be in the
order of 4 billion ECU or 300 million ECU per year. At the same time,
it must be underlined that 3.3 billion ECU will be saved in avoided
fuel cost to 2010 and external benefits in the order of 2 billion ECU
per year are estimated.
The following table summarises the figures related to the Campaign and
estimates the direct benefits in avoided fuel costs and reduction of
CO2 emissions.
_________________________________________________________________
Campaign Action Proposed New Installed Capacity Estimated Total
Investment Cost billion ECU Suggested Public Funding billion ECU Total
Avoided Fuel Costs billion ECU CO2 Reduction million tn/year
1.1,000,000 PV systems 1,000 MWp 3 1 0.07 1
2.10,000 MW Wind Farms 10,000 MW 10 1.5 2.8 20
3.10,000 MWth Biomass 10,000 MWth 5 1 - 16
4.Integration in 100 Communities 1,500 MW 2.5 0.5 0.43 3
Total 20.5 4 3.3 40
_________________________________________________________________
Chapter 4 Follow up and Implementation
Implementation and Monitoring of Progress
During the period of implementation of the Strategy and Action Plan
outlined in this White Paper, there is the need for a constant
monitoring of activities in order to follow closely the progress
achieved in terms of penetration of RES, and to ensure and improve
co-ordination of programmes and policies under the responsibilities of
the Community and the Member States.
There is,in this context a case for improving the co-ordination and
data collection as regards the action on renewables undertaken within
the various programmes of the Community and the activities of Member
States, and for developing a unified acceptable system of statistics
based on the substitution principle. The Commission, in the framework
of the ALTENER II programme and in co-operation with the Statistical
Office and the JRC will create a monitoring scheme which can register
all Community support given to renewables as well as the action
undertaken at national level and progress made in terms of renewables
penetration in different sectors. In this way policies and programmes
affecting renewables and progress towards increasing the share of
renewables can be monitored reliably and effectively.
Internal Co-ordination of EU Policies and Programmes
A major added value of a Community Strategy is the proposed
integration of the promotion of RES in several policy areas. In order
to ensure the effective follow-up and implementation of this aspect
within the Commission, the internal co-ordination will be strengthened
to deal with all policy aspects of renewable energy integration in the
Community's policies and areas of responsibility.
Implementation by Member States and Co-operation at EU level.
The active participation of the Member States in the further
development and implementation of the Strategy, as well as in the
assessment and monitoring of progress is essential. Co-operation
within an EU-framework provides added-value for the effectiveness of
the actions and also offers considerable benefit to Member States, as
successful policies and experiences on national and local levels can
be disseminated and objectives and actions can be coordinated. Joint
policies and transnational Projects will increase efficiency.
A working group involving Commission and Member States representatives
will be established in order to monitor the measures undertaken and
evaluate the impact of energy policy decisions at all levels with
regard to the use of renewable energy sources. Member States need to
adopt national goals and strategies, and these will be compared
alongside European wide action discussed and to be put into effect.
The Member States, as part of their contribution to this process, will
be asked to report to the working group the feasible contribution they
can realistically make to the 2010 target, including how they intend
to promote renewables sector by sector. The working group should also
co-ordinate responses and form a view on the likelihood of the RES
Community objective being achieved,and if necessary stimulate new
measures.
Implementation of Action Plan - Next Steps
The Community Strategy presented above is the basic framework for
action for achieving the indicative objective of 12% penetration of
renewables by 2010. In order to implement the Strategy, concrete
measures are proposed in an Action Plan (Annex I), which the Strategy
sets out the individual actions by categories, and indicates the form
of each action. Actions are attributed to the EU, Member States or
both, depending on the nature of the action and in accordance with the
principle of subsidiarity. Whole-hearted commitment will be necessary
from all the players involved, EU institutions, Member States,
regional and local authorities, industry and consumers, to implement
this Action Plan and, in so doing, achieve the objective adopted for a
significant increase in the share of renewable energies in the total
inland energy consumption by 2010. If the objective of doubling the
share is achieved it will have an important impact on reducing the
EU's CO2 emission as well as contribute to job creation and regional
economic development.
A Communication to the European Parliament, the Council, the Economic
and Social Committee and the Committee of the Regions will be produced
every two years in order to evaluate the success of the strategy and
recommend a revised direction and/or new actions if sufficient
progress in the penetration of renewables does not appear to be made.
The European Parliament, the Council, , the Economic and Social
Committee and the Committee of the Regions are invited to endorse the
EU Strategy and Action Plan set out in this White Paper, and to
support its implementation over the period to 2010.
Annex I
PRELIMINARY INDICATIVE ACTION PLAN FOR RES 1998-2010
(Includes some actions already initiated)
_________________________________________________________________
ACTION PLAN European Union Member States Chapter
1. Objectives and Strategies
Community Strategy and overall objectiveof 12% for the EU up to 2010
Communication of the Commission - White Paper - (1997) - 1.3.1
Member States setting individual objectives to 2005 and 2010 and
establishing strategies - action 1.3.1
2. Internal Market Measures
Fair Access for RES to the Electricity Market Proposal for a Directive
(1998) transposition 2.2.1
Restructuring the Community Framework for the Taxation of Energy
Products Proposal for a revised Directive (COM/97/30) transposition or
harmonisation 2.2.2
Start-up subsidies for new production plants. SME's and new job
creation - action 2.2.2.
Development or/and harmonisation concerning "golden" or "green" funds
1998 : Promotion2000 : Communication of the Commission action 2.2.2.
Progressive increase of the market share of liquid biofuels - action
2.2.3
Promotion of Biofuels in transport fuel Proposal for a Directive
COM(97)248 transposition 2.2.3
Promotion of biofuels in low-sulphur liquid fuels Proposal for a
Directive COM(97)88 transposition 2.2.3
Extend the scope of the SAVE Directive to passive and active solar
systems in buildings to take into account the energy gains for heating
and cooling Proposal for Amendment of Directive 93/76/EC (1998)
transposition 2.2.4.
Extend the scope of the Directive to building materials with a low
intrinsic energy content Proposal for Amendment of Directive 89/106/EC
(1998) transposition 2.2.4.
3. Reinforcing Community Policies
Inclusion of Actions on Renewables in the overall strategy for
combatting climate change Communication of the Commission COM(97)481 -
2.3.1.
Adoption and implementation of the 5th Framework Programme for RTD
(1998-2002) Decision of the EP and the Council (.../.../...) - 2.3.4.
RES to be included in the main priorities jointly with employment and
environment in the regional fund new phase (2000-2006) To be decided
in 1999. implementation 2.3.5.and2.3.6.
Promotion of biomass in CAP and rural development proposals for
2000-2006 CAP proposals/Agenda 2000Decision awaited 1998 - 2.3.6.
Review of Reg. 2078/92 in context of Agenda 2000Examination of
adequacy of existing instruments and possibility of further
harmonisation Review of Reg. 2078/92 and other existing instruments -
2.3.6
Definition of an energy strategy for the co-operation with ACP
countries, in the Lomé Convention Framework, emphasizing the role of
RES Communication - 2.3.7
Sufficient funding from TACIS and PHARE for RES in order to implement
Protocoles opening EU support programmes ALTENER and SYNERGY to
associated countries. Appropriate agreements with Mediterranean area
countries as well as other areas. Collaboration in Specific
ProtocolsCommunication - 2.3.7.
4. Strengthening Co-operation between Member States
Strengthening co-operation between MS under Council Decision on the
Organisation of Co-operation around Agreed Community Energy Objectives
Proposal for a Council Decision(COM/.../...) implementation 2.4
5. Support measures
EU programme to promote RES, open to CEECs and Cyprus, aimed at
creating the necessary conditions for the implementation of the Action
Plan particularly the legal, socio-economic and administrative
conditions and encourage private and public investments i Proposal for
a Council Decision "ALTENER II"(COM/97/87)Proposal for Framework
Programme for Energy Actions 1998-2002 submission of projets -
Consumer information campaigns. Targeted information action on the
protection of environment with simultaneous energy recovery EU actions
- 2.5.2
Development of European standards and certifications CEN and CENELEC
under ALTENER certification by agreed bodies 2.5.2
Better positioning for RES on the institutional banks and commercial
finance market by developing schemes facilitating investments in RES
projects agreements and projects agreements 2.5.3
Creation of a virtual centre "AGORES" for collection and dissemination
of information action under ALTENER data 2.5.4
6. Campaign for take-off
1,000,000 PV systems half in EU, half in third countries. EU promotion
and financial contribution co-funding 3.1
10,000 MW of large wind farm EU promotion and financial contribution
co-funding 3.2
10,000 MWth of biomass installations EU promotion and financial
contribution co-funding 3.3
Integration of Renewable Energies in 100 Communities EU promotion and
financial contribution co-funding 3.4
7. Follow-up
Scheme to monitor progress EU action under ALTENER data 4.1
Improvement of data collection and Statistics Commission action - 4.1
Inter-services co-ordination group Commission action - 4.2
Creation of a Working Group involving Commission and Member States
Commission action - 4.3
Regular reporting to the Union's Institutions Commission action - 4.4
_________________________________________________________________
Annex II
Estimated Contributions by Sector - A scenario for 2010
In this Annex, the realistic potential for exploitation of the
different renewable energy sources is presented within the framework
of the Strategy and Action Plan. The contribution that the various
renewable energy sectors could make by 2010 towards achieving the
indicative objective of 12% share of renewables is estimated. These
estimates present one particular scenario of RES development - it is
clear that the market could evolve differently. Nonetheless, it is
considered important to present an overall view of projected
developments, in order to help orientate policy instruments and
campaigns.
Biomass
Currently biomass accounts for about 3% of total inland energy
consumption (EU15). However in the new Member States - Austria,
Finland and Sweden - this renewable source already accounts for 12%,
23% and 18% respectively of primary energy supply. It is difficult to
make estimates in this area on future development as regards the
extent to which the biomass and its distribution sector will expand.
Under the particular scenario followed in this Annex, use of three
times the present amount of 44.8 Mtoe is considered to be a possible
development for 2010, on condition that effective measures are in fact
adopted. This would mean additional biomass amounting to 90 Mtoe,
equivalent to 8.5% of the projected total energy consumption in that
year.
Biomass is a widespread resource as it includes in addition to woody
biomass and the residues of the wood working industry, energy crops,
agricultural residues and agro-food effluents, manures as well as the
organic fraction of municipal solid waste or source, separated
household waste and sewage sludge. Energy from biomass is versatile in
that it can produce electricity, heat, or transport fuel as
appropriate, and unlike electricity it can be stored - simply and
usually economically. In addition, production units can range from
small scale up to multi-megawatt size.
The additional estimated bioenergy use of 90 Mtoe by 2010 would be
derived from agricultural, forest, and forest industry residues, waste
streams as well as from new energy crops. Biomass exploitation has the
double benefit of exploiting an important renewable energy resource
and also of improving the environment and climate. Clearly in the
development of biomass particular care will need to be taken to
safeguard bio-diversity in the EU. Strategies and approaches should be
adopted that minimise the impacts on bio-diversity.
The advantages of exploiting biomass, based on new technologies, can
be clearly seen in the case of biogas exploitation. This consists
largely of methane, a gas with a large greenhouse impact. It is
estimated that the total energy content of land fill gas and
digestible agricultural wastes in the EU exceeds 80 Mtoe. The
contribution that could be made by biogas exploitation from livestock
production, agro-industrial effluents, sewage treatment and landfill
by 2010 is estimated at 15 Mtoe. A stronger exploitation of the biogas
resource is indeed in line with the Commission's strategy for reducing
methane emissions on environmental grounds. This point has received
particular attention in the preparation of a global agreement on
greenhouse gas emissions. On the other hand, a new directive on
landfill which is currently being discussed by the European Union
institutions is rather going to limit the production of biogas from
land fill : The directive plans a 75% reduction of biodegradable
rubbish that can be dumped in landfill sites by 2010. However, the
volume of the organic matter that could be used as feed stock for the
production of biogas by anaerobic digestion would increase and the
organic matter landfilled before 2010 will continue to produce methane
by fermentation for several years after 2010.
As far as solid residues are concerned, there is first at all a huge
potential so far unexploited in the form of wood and agricultural
residues, straw etc. which exceeds 150 Mtoe per year. It is estimated
that 30 Mtoe can be mobilised annually by 2010 for the power and the
heating and industrial process heat market.
Energy crops also need to be considered if the objective of doubling
the renewable energies' share by 2010 is to be achieved. In total, the
contribution for bioenergy production from crops by 2010 is estimated
at 45 Mtoe i.e. an amount equal to that anticipated for bioenergy from
residues and wastes. Of this 18Mtoe could be in the form of liquid
biofuels (including however liquid biofuels from non-energy crops such
as wood residues, used vegetal oils, or biogas used as motor fuel) and
27 Mtoe as biomass for heat and/or power, under one particular
scenario.
Liquid biofuels are currently the least competitive product from
biomass in the market place, given the low oil prices. It is, however,
important to ensure their continuing and growing, presence in the fuel
market since the short/medium term oil-prices are unpredictable, and
in the longer term alternatives to the finite oil reserves are needed.
The energy demand in the transport sector is expected to grow strongly
in the future and so will the emission problems associated with it,
and the external dependence on oil, if no alternatives are available.
Biofuels have an overall positive energy balance, although this varies
from crop to crop, and also depends on the crop replaced. Whether
there is such an increase will depend crucially on closing the gap
between production costs of bio-fuels and competing products.
Future development of biofuels will have to be based mostly on
production in Europe. In 1993 the "utilised agricultural area" of EU15
was approx. 141 million hectares of which 76 million hectares were
"arable land". t is doubtful that more than a maximum of 10 Million
hectares, i.e. 7.1% of the agricultural area would be sustainable for
biomass crop production, the choice of crop species for liquid
biofuels would need to be limited to the most productive ones with the
maximum benefit and minimum environmental impact.
As far as the potential contribution of 27 Mtoe from solid cellulosic
bioenergy crops is concerned, the options for production are manifold.
This material can be derived from short rotation forestry, (ex:
willow), or non wood, energy crops (ex: miscantthus) also good for
combustion and gasification. There are various plant species suitable
for specific types of agricultural land. There is a choice of crops
for short rotation forestry on rather marginal land of lower value. At
yields of 10 tonnes per hectare and year, a production of for example,
27 Mtoe of solid biomass by 2010 would imply a cultivated area of 6.3
Million hectares of land. There exist also various options for high
yield C4 plants, annual or perennial ones. They deliver about twice as
much material as the short rotation forestry.
There are also plants which produce simultaneously cellulosic
materials and feedstocks for liquid biofuels. An example is sweet
sorghum which typically yields 5 m³ bioethanol and 20 t of dry
cellulosic material per hectare and year. It is important here to note
that the fast-growing plants have several other attractions : many are
annual and fit into conventional agricultural practice; they do not
require the best arable land; they require less than half the water
and fertilisers required by fast growing crops, such as maize. There
is also a promising prospect for production of liquid biofuels from
cellulosic matter. All options of species should be carefully examined
with preference given to the high-yielding/low input crops, which
respect biodiversity. In any case, it seems appropriate in any biomass
development strategy to set an upper maximum a limit for land use. It
is estimated, in this scenario approach, that if the maximum
reasonable development of biomass is made by 2010, as much as 10
Million hectares of land would be needed, much of it marginal land.
Clearly, the environmental impacts of this development would need to
be assessed, and the growth of the biomass sector would have to be
compatible with sustainable development.
The overall volume of the solid vegetal biomass market is estimated at
57 Mtoe in 2010, the projected feedstocks being energy crops (27 Mtoe)
and residues (30 Mtoe). If the market indeed develops in this
direction, it is predicted that 25 Mtoe would be taken up by the
market for direct heating and industrial process heat and 32 Mtoe
would go to power generation. A portion of these 32 Mtoe, i.e. 6 Mtoe
could be used in cofiring plants in combination with coal and the
remaining 26 Mtoe in combined heat and power installations
Projected additional bioenergy use by 2010
_________________________________________________________________
under the scenario presented 90 Mtoe
_________________________________________________________________
* Biogas exploitation (livestock production, sewage treatment,
landfills) 15 Mtoe
* Agricultural and Forest Residues 30 Mtoe
* Energy Crops 45 Mtoe
Hydro Power
Hydro power is a proven mature technology and its operation has been
competitive with other commercial energy sources for many years.
However, the existing technical and economic potential for large hydro
power plants has either been used, or is unavailable due to
environmental constraints. In contrast to this situation, only about
20% of the economic potential for small hydro power plants has been so
far exploited. In addition many existing small hydro plants are out of
operation, often as a result of a lack of specific incentives as to
maintenance and other costs, as well as the overall grid pricing
situation, but can be refurbished with relatively modest outlay,
especially in the case of small typically rural and relatively
isolated installations. European Union countries dominate the world
market for small hydro equipment.
In 1995 approximately 307 TWh of hydro energy was produced in the
Union from an overall capacity of 92 GW. Small hydro plants, i.e.
plants smaller than 10 MW accounted for 10% of installed capacity (9.3
GW) and produced 37 TWh.
An increase of 10 % in installed capacity of large hydro (8,500 MW) is
likely by 2010 if one takes into account projects already planned, and
some environmentally acceptable development. . An additional installed
capacity of 4,500 MW of small hydro plants by 2010 is a realistic
contribution which could be achieved given a more favourable
regulatory environment, since these small projects, if correctly
planned, can have much lower environmental impact.
Wind Energy
Wind energy technology is developing fast. The average weight of wind
turbines has halved in five years, the annual energy output per
turbine has increased fourfold, and costs have decreased by a factor
of ten in ten years. At present, the average size of new machines
being installed is 600 kW, although there are a few machines as
powerful as 1.5 MW on the market. About 90% of the world's
manufacturers of medium and large-sized wind turbines are European.
The largest machines are at present produced only by European
manufacturers. Wind turbines give rise to some noise pollution, and
research effort is being successfully undertaken to reduce noise
emissions.
Wind energy is in some Member States currently the fastest growing
energy source for electricity production. Europe is the world leader
in wind energy, with more installed capacity than any other region of
the world: 3.5 GW in EU15 at the end of 1996. There has been an
average annual installation growth rate of 36% in the past five years,
reaching, at present, an annual rate of 1 GW/year. If production
continues to increase by the same rate, yearly production of turbines
in 2010 will amount to more than 20 GW and the accumulated capacity
will be more than 100 GW. A constant installation rate at this current
value (~ 1 GW per year) would mean 18 GW of installed generation
capacity in 2010. Therefore an estimated contribution of 40 GW wind
power in the RES development by 2010 for the EU15, while ambitious, is
realistic given the strength of these trends. The campaign for
take-off for 10GW should provide a basis for wider implementation of
wind powered electricity generation under more difficult conditions.
A significant contribution from wind energy for 2010 can only be
achieved if conditions of access to the European grids are fair for
the wind generators. A major factor in the recent market success of
wind energy in Member States such as Denmark, Spain, and in particular
in Germany, which now has the world's largest electricity generating
capacity from wind, has been the price to be paid by utilities to wind
generators for sale onto the grid. Any major changes that might be
made in this regulatory structure should encourage and not jeopardise
the appropriate development of wind energy.
Solar Thermal
Solar thermal heating technology is almost fully mature. There is
nevertheless scope for further cost reductions from larger scale
production and improvements in both production processes and
marketing. At present in EU-15 about 300 small and medium enterprises
are active in this sector, directly employing about 10,000 people.
Solar thermal heating is cost-competitive today as compared with
electric water heating, in particular in the southern parts of the
European Union. Design is constantly being improved to minimise visual
impact.
In 1995 there were 6.5 Million m2 of solar collectors installed in the
European Union with a 15% growth rate over the preceding few years.
The annual current installation rate is 1,000,000 m2, concentrated in
three EU member countries - Austria, Germany, and Greece. A growth
rate of 25% could be achieved if the other 12 European Union member
countries even partially followed this example. At a 20% annual growth
rate, total installed capacity would be 100 Million m2 in 2010 which
taking all relevant factors into consideration is an achievable
contribution to RES development. Use of large collector fields in
large-scale applications such as district heating systems - the most
economically rational way of using solar thermal energy - would in
itself stimulate a dramatic increase in collector production. Public
awareness campaigns can effectively also boost the market as has been
borne out by experience in Greece.
Photovoltaics
Solar photovoltaic electricity generation is very much a recent and
close-to-state-of-the-art renewable energy technology. Costs have
fallen dramatically with a 25% cost decrease over the past 5 years,
but are still significantly higher than for electricity generated from
conventional fuels. The European Union, currently accounts for about
one third of annual, more than 100 MWp, world-wide photovoltaic module
production and use. The European industry has built up a leading
position in the field of photovoltaic incorporation in buildings.
Europe also has the lead in applications of photovoltaics in
developing countries.
Eurostat estimates that 32 MWp of photovoltaic generation capacity was
installed (EU12) at the end of 1995. The most recent estimate from the
European Photovoltaic Industry Association (EPIA) suggests as much as
70 MWp (EU 15). Photovoltaics is very much a global market. World
annual module production is forecast at 2.4 GWp by 2010. To attain an
annual output of 2.4 GWp world-wide, would require annual growth of
25%. Such an estimate is in fact compatible with the assumptions used
in an EPIA study commissioned by the Commission.
Under the above assumptions a contribution of 3 GWp installed capacity
in EU15 from photovoltaics by 2010 seems ambitious but realistic. It
is forecast that this would be accounted for mainly by grid-connected
installations incorporated into the structure of buildings (roofs and
façades) as well as a certain number of large-scale power plants
(0.5-5.0 MWp). Anyhow, PV technology should be considered in a more
general way not just as a measure of GWp installed. As it is the case
for solar thermal applications, PV systems are always associated with
Rational Use of Energy measures in buildings and can be evaluated as a
part of the significant effort of reducing energy consumption, which
always should accompany their utilisation. Grid-connected photovoltaic
generation is not competitive at currently prevailing classical
fuel-based generation costs and also compared with wind turbines, but
it could be based on an average cost level of 3 ECU/Wp of installed
capacity, which on the basis of current trends could happen around
2005. A sizeable initiative at European level for incorporating
photovoltaic modules in roofs and facades can thus play a major part
in definitively launching this technology. Secondary advantages of
building integration such as lighting, heat supply, façade
substitution should be valorised. The concept of energy system should
take into account the "added value of PV". Integration of 2 PV in
buildings can also convert any visual impact into an architectural
design advantage.
The campaign for take-off promoting the installation of 1,000,000
photovoltaic roofs and facades would mean new capacity of 0.5GWp in
the Union and 0.5GWp in third countries.
Passive Solar
Thermal energy demand (mostly for space heating) in the domestic and
tertiary sector in EU15 represents 23% of total energy demand. It is
estimated that 40% of energy actually consumed in this sector is in
fact gained from solar energy through windows, but this passive energy
supply is not taken into account in statistics. Consequently, the
potential for further reducing the thermal energy demand in buildings
with available passive solar techniques is very substantial. "Solar"
and "low-energy" buildings cost almost no more to build than
conventional ones. Experience in Austria has shown that passive solar
construction increases overall dwelling costs by less than 4% while
achieving 75% reductions in heating energy. Large gains can also be
achieved in the existing building stock by retrofitting windows and
facades to make more use of natural sunlight and simultaneously
insulate. New materials for windows, daylighting and insulation are
commercially available. Passive cooling techniques have also been
developed during the last few years and could help reduce the
fast-growing cooling demand in southern European countries.
Even conservative estimates show that a 10% reduction by 2010 in
thermal energy demand for buildings is easily attainable by increased
recourse to passive solar techniques. If it is assumed that thermal
energy demand in the domestic and tertiary sector remains stable (at
23% of the total), then this represents fuel savings of 35 Mtoe.
Switzerland has already committed itself to a 30% energy reduction for
heating in buildings by the same year. These additional gains should
be counted in the balance of the European Union's gross energy
consumption.
Geothermal and Heat Pumps
Geothermal energy accounts for only a very small part of total
renewable energy production in the European Union. Although power
production is already viable from high-temperature dry steam, the
risks associated with exploitation still present a disincentive to
investment. The use of geothermal heat is thus growing slowly.
However, the use of heat pumps to upgrade lower temperature ground
heat is becoming much more common.
Currently installed geothermal power capacity in the European Union
amounts to 500 MW. More electrical units are gradually coming on
stream in France (above all overseas departments), Italy, and Portugal
(the Azores). It is estimated that a doubling of the current installed
capacity is an achievable contribution to RES growth by 2010.
Most low-temperature geothermal heat is employed in buildings
applications. The current capacity of 750 MWth is concentrated in
France and Italy. This capacity could be more than tripled in 2010, to
give 2.5 GWth.
Turning to heat pumps, those installed to date mostly use electricity
or fuel as the necessary driving energy input. A new generation make
use of heat exchangers installed some 100m underground which thus
exploit naturally stored solar energy and some intrinsic heat from the
earth itself already at such a depth. A total of 60,000 geothermal
heat pumps were installed in 1995 in the European Union, most of them
in Sweden representing 8% of the capacity for all types. Assuming that
this total installed heat pump capacity will be tripled by 2010 in
EU15 and that the market share of geothermal heat pumps will double to
reach 15%, gives an estimated achievable total capacity of 2.5 GWth by
2010.
Other Renewable Technologies
There are a number of other renewable energy technologies, such as
solar thermal power, tidal power, ocean currents, wave power, hot dry
rock, ocean thermal energy conversion, for which the current market in
the European Union is non-existent. Projections are difficult to make,
but some of these technologies will undoubtedly offer significant
potential in the future. It is reasonable to expect that at least one
of these renewable sources will have started to be exploited
commercially over the coming decade or so, which justifies assuming a
marginal contribution of 1 GW by 2010.
Achieving the Overall Community objective for RES
Table 1A summarises the estimated contributions by sector described in
the present annex in the particular scenario chosen for projecting
ways of achieving a 12% share of renewables in the Union by 2010.
Table 2 compares gross energy consumption by type of renewable energy
in Mtoe for the year 1995 with that projected for the year 2010,
assuming that these contributions by the different RES are indeed
made. On this basis the overall objective of doubling the current
share of renewables to 12% by 2010 can be realistically achieved. The
projected total gross inland consumption for 2010 is taken from the
Pre-Kyoto scenario (Conventional Wisdom, "European Energy to 2020",
see footnote 8). If post-Kyoto energy use turns out to be lower than
that foreseen prior to Kyoto, this will have the effect of slightly
increasing the current indicative objective to above 12%. On the other
hand, enlargement to States with very little or no penetration of
renewables may have the effect in practice of lowering the objective
to below 12%. This will be taken into account in the monitoring and
review mechanisms foreseen.
Estimated RES Contributions in Electricity and Heat Generation
In Table 3 the current and projected contribution of renewables to the
electricity market is presented by type of energy. If appropriate
measures are taken, electricity production from renewables could grow
significantly by 2010, from the present 14.3% to 23.5%. The projected
total electricity production for 2010, once again, is taken from the
Pre-Kyoto scenario. Finally, the doubling of the heat produced by
renewables is the projected development for 2010 for the heat sector
as shown in table 4 if the promotion strategy for RES is successful.
Assessment of some of the costs and benefits
In table 6 the estimated investment costs and the benefits related to,
avoided fuel costs, and CO2 emissions reduction, are presented by type
of renewable energy while Table 5 provides estimates for the overall
strategy to 2010. The first column of Table 6 shows the additional
capacities needed to be installed in order to achieve the estimated
contributions by different RES. In columns 2 and 3 the current unit
costs by type of technology and the corresponding projected unit costs
in 2010 are presented respectively. The fourth column shows an average
reference unit cost, where the projected time frame for the deployment
of each technology is taken into account. For those types of energy
where installations are projected to grow steadily, such as wind
energy, the average unit cost is nearer to the 2010 value. For those
technologies, such as hydro, where the installations will be more or
less evenly distributed in time, the mean value between 1997 and 2010
is taken as the average reference unit cost. In the 5th column the
total investment needed for the installations is presented. Column 6
shows the expected annual business in 2010. Installation rate,
operation and maintenance as well as fuel costs (for biomass) are
included in the figures presented in this column.
Estimations on avoided fuel costs are presented in columns 7 and 8.
Additional fuel savings from wind, hydro, photovoltaics and solar
thermal collectors have been estimated to be 3 billion ECU in the year
2010. Assuming a constant rate of increase of installations during the
period 1997-2010, a total amount of 21 billion ECU of additional fuel
savings is calculated. Fuel substitution of coal and oil at 1997
prices has been assumed in all calculations. Biomass and geothermal
are considered to have the same fuel costs as fossil fuel technologies
and they are not included in the estimation. On the other hand, all
renewables contribute to the reduction of fuel import supplies
achieving a 17.4% reduction in 2010 with respect to the 1994 figures.
The last column shows the CO2 emission reduction figures. For
electricity production from wind, hydro, photovoltaics and geothermal,
the displacement mainly, but not exclusively, of conventional coal
fired power plants is assumed. The CO2 emissions, in this case, are
calculated on the basis that one TWh produced by renewable saves one
million tonnes of CO2. As far as biomass is concerned, although it has
a neutral effect on CO2, the emissions generated during the feedstock
production have been taken into account.
In addition, a significant number of additional jobs are expected to
arise as a result of the doubling of the share of renewable energies
foreseen in this Community strategy (see section 1.4).
The sum of these estimated figures shows that a total investment of
165.1 billion ECU could be needed in order to achieve the overall
significant increase in renewable penetration aimed for in this
strategy. . As a result of this investment, an annual business of 36.6
billion ECU is estimated to be generated in 2010, creating a
significant number of new jobs, avoiding fuel costs of 21 billion ECU,
reducing imports by 17.4% and reducing the CO2 emissions by 402
million tones per year with respect to 1997.
Annexe III Member States' plans and actions for the development of
renewables
Austria has a share of 24.3 % for RES. The Austrian government
introduced in 1996 an energy tax on electricity and gas excluding RES.
In 1994 a promotional tariff for power generation from solar, wind and
biomass was introduced. Further development of hydro power, biomass in
existing thermal plants and energy crops and solar energy are the main
objectives.
In Belgium, energy policy has been decentralized. While there is no
specific target for the energy sector, promoting RES is expected to
see a reduction in CO2 emissions of about 20 MT by 2000 in industry.
In Wallonie the PEDD (Environment plan for sustainable development),
adopted in 1995 is expected to be followed by a development programme
for RES.
In 1996 Denmark elaborated an Energy Action Plan "Energy 21" including
medium and long-term scenarios to 2005, 2020 and 2030. The assumptions
to 2005 for RES include 200 MW offshore wind turbines, about 1 PJ
landfill gas and about 1 PJ geothermal heat. After 2005 the
assumptions include developing 5500 MW wind turbines (of which 4000 MW
offshore), 145 PJ annually from biomass and biogas including energy
crops and 25 PJ annually from geothermal and heat pumps in
district-heating.
The Finnish government adopted in 1995 a decision on energy policy
which includes increased use of bioenergy of 25% by 2005. A promotion
programme for wind energy in 1993 set a target of 100 MW installed
capacity by 2005.
France started in 1996 a five year programme including 225 MW from
wood combustion, 20.000 solar thermal panels for the DOM areas and 250
to 500 MW of wind turbines "Eole 2005".
In Germany the Act "Stromeinspeisungsgesetz" of 1991 has had a
significant effect on new capacity from RES. A programme to support
RES was adopted by the Federal Government with 100 million DM for the
period 1995-98. Many of the Länder also have programmes. RTD is very
important, with a 250 MW wind demonstration programme. 30% of the
government's RTD programme is for RES. Solar thermal and PV campaigns
(1000 Roofs) have had an important impact. In wind energy, Germany
holds second place in the world.
The Greek government has a comprehensive approach to encourage RES.
The law 2244/1994 was strengthened by the Decision 8295/1995 in order
to remove restrictions on electricity production from independent
producers up to 50 MW. The electric utility (PPC) has a ten year
programme to develop RES with the following targets : biomass (733
Mtoe by 2000 and 1400 Mtoe by 2005) wind (68 and 136 Mtoe) small hydro
(15 Mtoe and 41) solar (156 Mtoe and 204) and geothermal (20 Mtoe and
40). In 1994 a second Support Framework of the Community earmarked 100
MECU for RES, 75% of funding will come from structural funds.
In Ireland, as a result of the AER 1 and 2 initiatives (Alternative
Energy Requirement programme of 1994) and the RES Strategy, the
additional RES generation will be 6% of installed capacity by 1999
bringing the total to 11%.
In Italy, if progress continues the PEW (National Energy Plan)
expectations could be surpassed and RES could give a contribution of
2700 MW by 2000. Specific targets are 600 MW for wind and 75 MW for PV
by 2000.
Luxembourg has no specific policy objectives for RES, nevertheless
instruments include subsidies for solar, biomass, wind, small hydro
and heat pumps.
The Netherlands has an Action Programme 1997-2000 for RES and has
elaborated scenario for 2007 and 2020 which includes: development of
wind energy (750 MW in 2000, 2000 MW in 2007) solar PV(119 MW 2007)
biomass (residual flows 30-80PJ/year and energy crops (12-70 PJ/year)
solar Thermal (5 PJ in 2007 or 250.000 water heaters) and heat pumps
(50 PJ in 2007).
In Portugal, the Energy Programme of 1994 had a target of about 170 MW
for RES electricity. Traditional biomass is about 26% of energy needs
in the residential sector. The biomass centre has a specific programme
to develop biomass.
In Spain the PEW (National Energy Plan) for 1991-2000 had the
following objectives : SMP 213 Mtoe, biomass 427 Mtoe, wind 35 Mtoe,
PV 0.389 Mtoe, solar 34 Mtoe and geo thermal 10 Mtoe. At the end of
1996 the objectives were surpassed in SMP 1045%, wind 381.5% and PV
149%.
The Swedish Government Bill 1996/97 : 84 on a Sustainable Energy
Supply includes measures aimed at increasing the supply of electricity
and heating from RES. The five year scenario for RES includes an
expansion of bio-fuel-based CHP of approximately the equivalent of
0.75 Twh of electricity per year, an annual increase of around 0.5 Twh
from land-based wind facilities and an annual increase of 0.25 Twh
from small-scale hydropower.
The United Kingdom is currently reviewing its policy on renewable
energy, consideration being given to achieving 10% of the country's
electricity need from RES by 2010.
_________________________________________________________________
Table 1
Share of Renewable Energy Sources in Gross Inland Energy Consumption
Country 1990 1995
Austria 22.1 24.3
Belgium 1.0 1.0
Denmark 6.3 7.3
Finland 18.9 21.3
France 6.4 7.1
Germany 1.7 1.8
Greece 7.1 7.3
Ireland 1.6 2.0
Italy 5.3 5.5
Luxembourg 1.3 1.4
Netherlands 1.3 1.4
Portugal 17.6 15.7
Spain 6.7 5.7
Sweden 24.7 25.4
United Kingdom 0.5 0.7
European Union 5.0 5.3
Source: EUROSTAT
_________________________________________________________________
Table 1 A
ESTIMATED CONTRIBUTIONS BY SECTOR IN THE 2010 SCENARIO
TYPE OF ENERGY SHARE IN THE EU IN 1995 PROJECTED SHARE BY 2010
1. Wind 2.5 GW 40 GW
2. Hydro 92 GW 105 GW
2.1 Large (82.5 GW) (91 GW)
2.2. Small (9.5 GW) (14 GW)
3. Photovoltaics 0.03 GWp 3 GWp
4. Biomass 44.8 Mtoe 135 Mtoe
5. Geothermal - -
5.a Electric 0.5 GW 1 GW
5.b Heat (incl. heat pumps) 1.3 GWth 5 GWth
6. Solar Thermal Collectors 6,5 Million m2 100 Million m2
7. Passive Solar - 35 Mtoe
8. Others - 1 GW
_________________________________________________________________
Table 2
CURRENT AND PROJECTED FUTURE GROSS RENEWABLE ENERGY CONSUMPTION (Mtoe)
FOR 2010
CONSUMPTION IN 1995 PROJECTED CONSUMPTION BY 2010
TYPE OF ENERGY Eurostat Convention % of total Substitution Principle %
of total Eurostat Convention % of total Substitution Principle % of
total
Total Gross Inland Consumption 1,366 1,409 1,583 (Pre-Kyoto) 1,633
1. Wind 0.35 0.02 0,9 0.06 6.9 0.44 17.6 1.07
2. Total Hydro 26.4 1.9 67.5 4.8 30.55 1.93 78.1 4.78
2.a. Large (incl. pump storage) (23.2) - (59.4) - (25.8) - -66 -
2.b. Small (3.2) - (8.1) - (4.75) - (12.1) -
3. Photovoltaics 0.002 - 0.006 - 0.26 0.02 0.7 0.05
4. Biomass 44.8 3.3 44.8 3.12 135 8.53 135 8.27
5. Geothermal 2.5 0.2 1.2 0.1 5.2 0.33 2.5 0.15
5.a Electric (2.1) - (0.8) - (4.2) - (1.5) -
5.b Heat (incl. heat pumps) (0.4) - (0.4) - (1.0) - (1.0) -
6. Solar Thermal Collectors 0.26 0.02 0.26 0.02 4 0.25 4 0.24
Total Renewable Energies 74.3 5.44 114.7 8.1 182> 11.5 238.1 14.6
7. Passive Solar - - - - 35 2.2 35 2.1
_________________________________________________________________
Table 3
CURRENT AND PROJECTED ELECTRICITY PRODUCTION BY RES (tWh) FOR 2010
ACTUAL IN 1995 PROJECTED FOR 2010
TYPE OF ENERGY TWh % of total TWh % of total
Total 2,366 2,870 (Pre-Kyoto)
1. Wind 4 0.2 80 2.8
2. Total Hydro 307 13 355 12.4
2.a. Large (incl. pumped storage) -270 - -300 -
2.b. Small -37 - -55 -
3. Photovoltaics 0.03 - 3 0.1
4. Biomass 22.5 0.95 230 8.0
5. Geothermal 3.5 0.15 7 0.2
Total Renewable Energies 337 14.3 675 23.5
_________________________________________________________________
Table 4
CURRENT AND PROJECTED HEAT PRODUCTION (Mtoe) FOR 2010
TYPE OF ENERGY ACTUAL IN 1995 PROJECTED BY 2010
1. Biomass 38.04 75
2. Geothermal 0.4 1
3. Solar Thermal Collectors 0.26 4
Total Renewable Energies 38.7 80
4. Passive Solar - 35
_________________________________________________________________
TABLE 5
ESTIMATED INVESTMENT COSTS AND BENEFITS OF THE OVERALL STRATEGY IN THE
2010 SCENARIO
Total investment energy sector of which RES 249 billion ECU
39 billion ECU
Total investment RES in Action Plan 165 billion ECU
Net investment RES in Action Plan 95 billion ECU
Annual net investment RES in Action Plan 6,8 billion ECU
Additional net investment due to RES 74 billion ECU
Increase of total energy sector investment 29.7%
Employment creation see Section 1.4
Avoided annual fuel cost in 2010 3 billion ECU
Total avoided fuel cost 1997-2010 21 billion ECU
Import reduction (ref. 1994) 17.4%
CO2 reduction (with respect to 1997)
(with respect to the 2010 pre-Kyoto scenario) up to 402million tn/year
250 million tn/year
Annual benefits from CO2 reduction 5 to 45 billion ECU
_________________________________________________________________
TABLE 6
ESTIMATED INVESTMENT COSTS/ BENEFITS BY SECTOR
TYPE OF ENERGY ADDITIONAL CAPACITY 1997-2010 UNIT COST 1997 ECU UNIT
COST 2010 ECU AVERAGE UNIT COST ECU TOTAL INVESTMENT 1997-2010
(billion ECU) ADDITIONAL ANNUAL BUSINESS 2010 (billion ECU) BENEFIT OF
ANNUAL AVOIDED FUEL COSTS 2010 (billion ECU) TOTAL BENEFIT OF AVOIDED
FUEL COSTS 1997-2010 (billion ECU) CO2 REDUCTION milliom tn/yearIN
2010
1. Wind 36 GW 1,000/KW 700/KW 800/KW 28.8 4 1.43 10 72
2. Hydro 13 GW 1,200/KW 1,000/KW 1,100/KW 14.3 2 0.91 6.4 48
3. Photovoltaics 3 GWp 5,000/KWp 2,500/KWp 3,000/KWp 9 1.5 0.06 0.4 3
4. Biomass 90Mtoe - - - 84 24.1 - - 255
5.Geothermal (+ heat pumps) 2.5 GW 2,500/KW 1,500/KW 2,000/KW 5 0.5 -
- 5
6.Solar Collectors 94 Mio m2 400/m2 200/m2 250/m2 24 4.5 0.6 4.2 19
Total for EU market 165.1 36.6 3 21 402
_________________________________________________________________
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European Commission
Directorate-General XVII (Energy)
e-mail:info@bxl.dg17.cec.be
Site Published: Mon Sep 15, 1997
Last update: 04/12/1997