10.Ups and downs in Europe

Europe’s PV sunrise

A boom in the installation of photovoltaic (PV) solar panels has been forecast by the 47 company strong European Photovoltaic Industry Association, which met in Switzerland, last Sept., with growth targets of 3 gigawatts of installed capacity by 2010 expected to be exceeded.

The installation of photovoltaic systems is growing by about 30 % a year, and up to 100,000 new jobs could be created in the industry as a result, the meeting heard. However, warnings were also sounded that the price of the technology needed to be trimmed if it is to break through to a substantially larger market share. More information: www.epia.org

But Clouds ahead?

Meanwhile, German solar firms are optimistic despite rumblings from the EU about the REFIT renewable feed in subsidy- and possible R&D cut backs. Germany is the EU market leader, and, globally, is number three after Japan and the U.S.A. in terms of installed capacity of photovoltaic technology. Germany’s solar sector depends on the Renewable Energy Law (EEG) that allows solar power producers to charge 99 pfennigs/(kWh for solar-generated electricity fed into the grid compared with costs for conventional electricity of 6 pf/kWh. However, according to Reuters, EU Competition Commissioner Mario Monti has repeated his opposition to the EEG as a government subsidy, while German Economics Minister Werner Mueller said last summer that he wanted a cut in the research budget for renewables. With Germany’s red-green governmental coalition shaken by disagreements over support for U.S. policy in the middle east, it is not clear which way it will go, but the renewable advocates are still optimistic that renewables will win through.

For example, Hermann Scheer, president of the European solar energy association Eurosolar has argued that the high cost of PV should not deter the promotion of solar energy, which, along with other renewable energies like wind, biomass and geothermal, will, he said, eventually replace the conventional centralised supply system. "Some 80% of conventional electricity costs cover distribution, while renewable energies do not need long-distance transmission lines and will save on this huge transport cost."

See our Reviews and Technology Sections in Renew 136 for more on PV.

Sweden tightens up

Sweden’s Society for Nature’s Conservation is sharpening its criteria for green electricity from renewable energy sources, so as to boost environmental awareness and improve product standard. The group sells the label "Bra Miljoval" to companies, aiming to assure customers that products, ranging from electricity to washing powder, have been produced with methods that harm nature as little as possible. "Bra Miljoval" is, together with the U.S. label "Green-e", one of the oldest tags for renewable energy such as solar, wind, biomass and hydropower. The new restrictions focus on hydropower and stipulate that producers invest money in a fund to choose from a list of measures to protect the environment for animals and plants near hydropower stations. "The criteria for hydropower were not tough enough so there was room to make changes as part of our perpetual work to boost environment awareness", Fredrik Lindberg, spokesman at the society, told Reuters. Some of the alternatives involved regulation of the water stream at water reservoirs. Power producers would no longer be allowed to cut the water flow entirely to get the maximum price. Lindberg said "It is very harmful to nature if you cut the stream totally".

Lindberg said it was still unclear how costly the new restrictions would be to companies but argued that there was leverage to increase the fees on green hydropower which is a relatively cheap energy source. "Companies make large profits from green hydropower and therefore I don’t think it's more than right that nature should gain something out of that", he said. Biomass and windpower criteria also became tougher as the agency has sought to curb harmful tree felling and forbid the construction of wind turbines in nature reserves.

Major Danish Cuts

Denmark may now get 12% of its electricity from wind turbines, but things are looking grim for the future. On January 29, 2002, the newly elected liberal/conservative Danish government presented the draft budget for 2002 and beyond. As a result, it seems, most of the R&D programmes, financial support, committees, and government agencies that have been crucial in the development of renewables will immediately be cancelled or dissolved. Many other environmental projects and overseas aid programmes will also be cut. The government will spend the 20m euro saved on hospitals, senior citizens and a 1yr maternity leave programme. It appears from the draft budget that most of the funding of renewables has been eliminated- and the new government has the parliamentary majority to implement its plans. Needless to say, most people see this as a disaster for many Danish innovative institutes, companies, inventors, investors, and organisations involved with renewables.

Fortunately, the Risø State Laboratory will still have public support in the future, and the budget of its wind energy department will be go up from 70m DKK in 2001 to 112m in 2002. But it should be noted that the Danish installation of wind energy dropped from 600 MW in 2000 to 10 MW in 2001. The government has also cancelled plans for large scale off shore wind power. The power companies are no longer obliged to continue the off-shore programme; no public funding or guaranteed tariffs are available.

Why has all this happened? The Danish Folkcentre for Renewable Energy, which also lost its funding, suggest that, after having lost over 50% of their market share in power production to non- utilities (wind power, biogas, small scale CHP) in W. Denmark, ‘the central utilities have lobbied strongly to bring a stop to the successful decentralised renewable energy development. The government has followed the desires of the old energy sector that now is promising energy at low market prices’. There are also evidently indications that the new government may reintroduce plans for nuclear energy in Denmark, despite nuclear having been ruled out in 1985.

* To add to the crisis, as noted in Renew 134, the Danish scheme for supporting renewable energy via the issuing of green certificates has been having problems. Now, apparently, the Danes are going to pull out of the new approach - which is of a similar type to the UK’s new Renewables Obligation. Sales in Denmark have been abysmal since the new mechanism was set up. Whilst it’s not yet clear what will be the alternative, staying with the current REFIT mechanism seems favourite, particularly given the period of remission that the ECJ gave the German REFIT.

Details at www.windpower.dk/articles/onice.htm