9. EU Developments  

EU energy use still rising  

An EU action plan last year set a target of 20% less energy consumption by 2020. However, electricity consumption in the EU is growing, despite the extensive efficiency drive being promoted by member states. A report from the European Commission’s Joint Research Centre (JRC) shows increases across all sectors- residential, service and industry. As a result of new measures being imposed there have been some improvements, particularly in the case of “white goods”, such as refrigerators, washing machines and dishwashers.  But the report also points to widespread use of dishwashers, tumble driers, air conditioners and personal computers. In addition, satellite TV boxes, DVD players, broadband equipment and cordless telephones have had a big impact on consumption.

 Other important factors include households with several of the same sort of appliance, mainly TVs, fridges and freezers.  Household electronics left on stand-by have a significant effect on consumption.  The JRC researchers noted that, as older equipment is updated in a household, it is often transferred to other parts of the home instead of being replaced, meaning  greater electricity consumption.

*The UK and France are campaigning to persuade the EU to cut VAT rates on less environmental damaging products, such as insulation materials and greener models of cars and refrigerators, as part of the fight against climate change. 

EU-ETS CO2 cap allocations 

For the new round of the EU Emission Trading System  2008-12, the European Commission has accepted the proposed  national emission cap plans of the UK, France, Slovenia and Denmark, but for all the rest the proposed caps were reduced- some quite dramatically. Latvia’s cap was cut to 44.5% of that bid, Estonia’s to 52%, Lithuania’s to 53%, Bulgaria’s to 62.6%, Poland’s to 73% and Romania’s to 79.3%.

EU Biofuels debate 

 In March last year, the European Union  agreed to set a binding target for biofuels to make up at least 10% of petrol & diesel used by vehicles by 2020. A European Commission report says that to meet targets for feedstock, the EU should divert around 18% of its cereals harvests into making biofuel: ‘Under a 10% minimum obligation, about 59 million tonnes of cereals, or about 18% of domestic use, would be used as first- and including straw, also as second-generation feed stock. Most of the cereals used would be soft wheat and maize, the rest would fall mainly on barley.’  

Biofuels from food crops like wheat, maize, sugar or vegetable oils, labelled ‘first generation’, are relatively low yield and need energy intensive inputs like fertiliser, so that net carbon emission reduction may be low. There have been warnings that it was not going to reduce emissions much, if at all. And  talking about the US corn plans, the Economist, Sept 27th commented ‘Everyone seems to think that ethanol is a good way to make cars greener. Everyone is wrong.’ But the US nevertheless seems hell bent on expanding corn to ethanol production- it’s basically about replacing some oil and appeasing farmers, not dealing with climate change.

Longer term things may improve, at least in the EU. ‘Second generation’ biofuels use non-food products, such as straw and waste lumber, and they can be more energy efficient, require less land, and reduce net emissions more. The EC report says that by 2020 they could help meet around a third of the EU’s domestic biofuel production. The rest would presumably come from first generation fuels and from imports.  

However there are problems ahead. Firstly Europe is lagging behind its biofuel targets. In order to achieve its interim target of 5.75% biofuel by 2010, the Euro Commission is now considering making the target binding.  Secondly, last year saw the biofuels debate take on an international perspective- not least in terms of the likely level of EU imports from key suppliers like Brazil, Indonesia and Malaysia, and the eco-impacts of plantations and potential impacts on food prices. The EC report said ‘Imports would serve around 20% of the biofuel production. About half of them would be first generation feedstock and mainly oilseeds and vegetable oils’. The EC say it will develop strict sustainability criteria, while WWF has published proposals for a harmonised European scheme for biomass certification, designed by consultancy firm Ecofys. But global market pressures for ‘green’ fuel will take some resisting.  

Sources: Greenprices Weekly/Reuters 

Germany upgrades REFIT  

Germany’s Ministry for the Environment has issued revised rules for the its ground-breaking Renewable Energy Sources Act. Although support for PV has been levelled off, the renewable energy feed in tariffs for offshore wind, hydro and geothermal are to rise, beginning in 2009. It’s also increased its already ambitious target for renewables- from 20% to 27% by 2020. And a new target of 45% by 2030 has been added. The existing 2050 target is to get 50% of total energy from renewables.

The New Tariffs  

The Ministry’s report announced that tariffs for hydroelectricity will be raised to € 0.1267/kWh for <500 kW, to  Euro  0.0865/kWh  for >500 kW<2,000 kW, to  Euro 0.0765/kWh  for >2,000 kW<5,000 kW.

For geothermal, the new rules reduce the number of size classes from 4 to 2 and increases the tariff from Euro 0.15/kWh  to   0.17/kWh. The new rules also add a bonus of € 0.03/kWh  for geothermal used in heating.

For wind on land, hard hit by rising turbine prices, the annual tariff degression is cut from 2% to 1% per year.  A bonus of Euro  0.007/kWh will also be paid for turbines that are more compatible with the needs of the grid. For wind off shore, the tariff rises from Euro 0.0874/kWh  in 2009 to  0.11-0.14/kWh.

For rooftop solar PV, the annual tariff degression will rise from the current 5% to 7% per year beginning in 2009 and to 8% beginning in 2011.

The revised programme will add a new tariff class for systems >1,000 kW of Euro 0.3548/kWh. The current tariff is Euro  0.463 for  >100 kW.

For solar PV systems <30 kW the current tariff is  Euro 0.49/kWh.  For solar PV cladding <30 kW the current tariff is Euro 0.54/kWh For ground-mounted solar PV, the annual degression will be raised from 6.5% to 8.5% beginning in 2009 and to 9.5% beginning in 2011.         Data Source:  Paul Gipe

* € 1.5bn more German Technology minister, Annette Schavan, said the state would provide at least  €1.5 bn for R&D  projects to expand renewable energy.

German PV booms  

Although Feed-In Tariff support for  PV is being throttled back a bit (see above)- which has led to some complaints- the new higher degression rates could, more positively, be seen as reflecting the conviction that PV will continue to move down its learning curve to lower costs. Certainly the market is booming. In 2004 Germany became the single biggest PV market in the world, with the installation of over 360 megawatt peak capacity, ahead of Japan (280 MW) and the USA (90 MW). Since then expansion has continued- Germany now has over 3 GW of PV installed.  In a recent study, the Deutsche Bank research department calls the solar industry a ‘booming business’. It foresees a continuing growth of PV at 30% a year. It also says the solar thermal market will grow at 10-20% a year, and predicts that power from large solar thermal plants in sunny regions will fall to 5-7 eurocent/kWh within 15 to 20 years.

* The increased support for geothermal indicates the belief that this option can and should expand.  Geothermal hot water is used in southern regions for district heating systems and thermal baths, and there are 100,000 heat pumps (not strictly geothermal) installed in private homes, with another 24,000 added every year aided by support from the government. Geothermal electricity generation is however still in its infancy, although there are 150 projects in the planning stage in Germany, with an investment volume estimated at € 4 bn.    Source: ReFocus Weekly

* Nuclear still out  Last year, trying to win over the government and public opinion, RWE, one of Germany’s largest energy groups, published a 4-page paid supplement in several newspapers in which its CEO, Harry Roels, appealed to the government to reconsider its nuclear policies. He said the decision to phase out nuclear was made ‘when climate protection was not as high in the public imagination as it is today’. But German President, Angela Merkel, has ruled out any change to the policy before the next election, scheduled for 2009. A fire at Kruemmel nuclear plant and a failure at the Brunsbuettel plant last year certainly undermined the anti-phase out campaign. Social Democrat Environment Minister Sigmar Gabriel, commented wryly ‘German nuclear power plants are the safest worldwide, aside from the occasional explosion or fire’. He called for the phase out of old plants to be speeded up.

Ireland up 

8.5% of Irelands electricity was from renewables in 2006  up from 6.8% in 2005. Wind’s share was 5.6% of the total, hydro’s 2.5%. It wants to get 15% from renewables by 2010, 33% by 2020. As well as wind, its also looking at marine options: Ireland has a Euro 141m ‘Sea Change’ marine research & innovation  project which  includes ocean  energyMore: www.sei.ie

Scottish-Norwegian undersea grid link?

Scotlands First Minister, SNP leader Alex Salmond, has been in discussion with the Norwegian prime minister over plans to create a subsea ‘supergrid’ to take green energy from Scotland to  

Europe. In Oct., Salmond told the  Highlands & Islands Convention ‘We have 6 to 7 times the power Scotland needs, but we have to figure out how we take that power to market’.