Renew On Line (UK) 74
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Renew, Issue 174 July-Aug 2008
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6. EU Developments
EU plan reactions
The European Commissions new Renewables Directive (see Features, Groups and Reviews in Renew 174 for details) produced a lot of reactions, mostly favourable. Some countries complained about the hard targets they were set (see Groups, Renew 173), but the UK government seemed reasonably sanguine about its 15% target- although it admitted it will be hard, and of course the EU plan is still up for discussion.
However, there was relief from many that Feed-In Tariff systems would be safe, but some free market devotees regretted that the fact that the EC backed off from imposing a EU wide mandatory green certificate trading system- an idea backed by the UK government.
Wind Power Monthly (Feb 2008) noted that now ‘each country will choose its own mechanism for stimulating investment in renewables within a closed market. The Commission warns that this walled-garden approach will cost the consumer an extra EUR 1.8 bn.’ It added ‘Even without certificate trade, the Commission’s proposals are complex. The risk of the legislation unraveling when national governments attempt to transpose the grand ideas into workable laws is real. It appears that consumers could end up paying for the environmental benefit of wind power twice. The Commission needs to let us know if that is the intention of its legislation.’
However it warned that ‘the fight over green certificate trade in Europe is far from over yet’, and cited the EU view of energy commissioner Andris Piebalg that the development of wind and other renewables in Europe post 2020 will be driven solely by trade in carbon credits. ‘I believe that after 2020 the EU will not need a specific renewables directive at all. The long term certainty of carbon pricing is the main driver.’ He said the renewables directive was ‘a temporary measure designed to support deployment of new renewable technologies,’ but soon ‘the maturity of the industry and the high price of carbon would ensure its further development’.
Others were less sure. The World Future Council was worried about how the national renewable targets would be policed- although they were labelled as ‘legally binding’ the compliance regime was in fact very weak, unlike the regime imposed for compliance with the national emission targets, which had serious penalties for defaulters.
The Open Europe lobby group, no friend to command-and-control regulatory approaches, claimed that no amount of tinkering with the EU Emission Trading System would make it work effectively- instead what we needed was a carbon tax, and then a level playing field free market, with no subsidies at all, so companies could choose technologies in response. All very short term: it means renewables might not get chosen- since efficiency was cheaper in the short term. More in Renew 175, and http://www.europe-economics.com
Biofuels The EC position on biofuels attracted negative reactions, buttressed by a study by Nature Conservancy published in Science, which claimed that it would take 17 years to repay the carbon debt incurred when sugar cane is grown in savanah in Brazil, 48 years for maize on set aside land and 840 years for palm oil if it displaced tropical rainforest. But the UK National Farmers Union insisted that biofuels grown in the UK offered carbon savings above 50%.
For more reactions to the EU plan see Groups in Renew 174.
UK castigated for supporting nuclear
While there has been general support for the new EU energy plan for renewables (see left), there have been more negative reactions to the UK’s Nuclear White Paper.
Andrew Warren from the UK Association for the Conservation of Energy, writing in the Daily Telegraph (5/02/08), quoted the then Labour government Industry Secretary, Patricia Hewitt, who had introduced the 2003 energy White Paper in the Commons by saying ‘It would have been foolish to announce that we would embark on a new generation of nuclear power stations. Because that would have guaranteed that we would not make the necessary investments in both energy efficiency and renewables. That is why we are not going to build a new generation of nuclear power stations.’
Warren asked- what had changed? And basically he said it was a political rather than technical decision, and certainly not an economic decision, led by those who had always favoured big technologies like nuclear. That’s water under the bridge now, but the result is that the UK is being seen by some greens as a something of a bogey man.
WISE, the World Information Service on Energy, devoted most of its Jan ‘Monitor’ issue to an analysis by Sergio Oceransky from the Nordic Folkecentre for Renewable Energy of the UK nuclear decision and its attempt to get a mandatory green power trading system imposed EU wide, which the WISE analysis saw as linked. It’s a bit of a conspiracy theory stretch, and the UK was not the only country keen on it, but you could argue that the push on green certificate trading was seen as a way to kill off REFIT and hence renewables, making the EU ripe for nuclear expansion. Certainly it’s true that if renewables are slow to develop then nuclear stands more chance of being taken up. Fortunately the EC decided to postpone the move to a single EU-wide green credit trading system- the opposition was just too strong, and REFIT is so clearly better. But the EC did propose a major revamp for the EU Emission Trading System. According to WISE, that has problems- since for example, the UK now sees the ETS as the way to get nuclear funded. Of course if carbon prices rise enough to make nuclear viable, then many of the renewables will also look good- if not better. The WISE analysis does not claim that enthusiasm for nuclear is the sole driver of UK energy policy- equally they suggest there is fear about whether renewables are up to the job of meeting the EU’s new 20% by 2020 energy target, and, more importantly, there is concern over the cost of trying to do that. Hence the talk, at one stage, of ducking the target, or getting it reduced. In the event, the UK was given 15%- still subject to negotiation. Less than 20%, but still quite tough. And, with the green certificate trading plan also temporarily abandoned, you could say the UK had failed to carry the day!
The full WISE analysis may be seen as over blown, but parts of it ring true: the UK’s nuclear decision will have EU-wide and indeed global implications. If the Brits are going back to nuclear then clearly, others would say, it’s a good idea, so we will do it too. As for the wider issues, well in the UK, while the governments policies are not always seen as wonderful, it’s also often argued that the French and German Ulitites, who now own most of the UK electricity supply and distribution/retail system, are a problem, along with the UK based big Oil companies. The vast profits made by these various energy companies in recent years have led to talk of another round of windfall taxation. That might be used to fund the rewiring of the UK that will be needed if decentral renewables are to develop fully. The big energy companies clearly would like to avoid that- and in something of a pre-emptive action perhaps, E.ON recently warned that the EU’s regulatory approach was strangling the industry, limiting investment in new plants and improved grid links.
The WISE article ends up saying ‘what we need now, urgently, are intelligent policies based on the common good, rather than on the concentration of power and wealth in the hands of large energy corporations and the state’. And it calls for political mobilisation at the grass roots. Whoever said ideology was dead! The full WISE analysis (in Nuclear Monitor issue 666) is at http://www.antenna.nl/wise For more on the nuclear debate see Groups.
EU Offshore Wind: 40 GW by 2020?
The European Wind Energy Association’s policy recommendations for large-scale deployment of offshore wind in Europe by 2020, ‘Delivering Offshore Wind’ suggest that, ‘in the medium term up to 2015, based on a number of market estimates and on projects currently being planned, 10-15 GW of installed capacity in Europe can be forecast. In this period, development will be mainly driven by the UK, followed by Germany.’
It uses two scenarios to map out possible trends, a low ‘minimal efforts’ and high ‘policy impetus’ scenario, resulting in two cumulative installed capacities by 2020 of 20 GW and 40 GW respectively. It says that ‘If offshore wind energy grows at the same rate over the next 14 years as onshore wind energy has over the past 14 years in the EU, 50GW of offshore wind will be reached in 2020. However, lead times for planning, lack of physical infrastructure, long project development times and short-term supply chain bottlenecks make this unlikely by 2020.’
Given the UK’s recent commitment to getting 33GW installed by 2020, the EWEA’s EU capacity estimates may need upward revision, but the problem with material and equipment supplies is a real one, so they may turn out to be right.
Even so there’s a lot out there. The EWEA claim that ‘A fully developed European offshore wind resource could deliver a capacity of several hundred GW to supply our future energy demands. Developing less than 5% of the North Sea surface area would enable offshore wind to supply roughly one-quarter of the EU’s current electricity needs.’ That would they say require ‘180 GW over a developed area totalling some 17,900 km2, which is approx. 3% of the total 575,000 km2 surface area of the North Sea’.
For the moment however, the industry is only just getting established, and is based in only a few countries. The EWEA says that ‘No series production in offshore wind manufacturing and installation has yet been established, and the sector is still developing and utilising large specialised components rather than the standard components needed for reducing cost’.
So where next? There are clear policy advantages in pushing for more offshore wind. The EWEA says that ‘Offshore wind power could significantly reduce fossil fuel imports. An estimated capacity of 40 GW would produce 140 TWh, representing 13 tones of oil equivalent of fossil fuels’.
They note that ‘according to the European Commission, the 20% binding target by 2020 implies 35% of electricity from renewables compared to 15% in 2005. In its strategic energy review, the European Commission estimated that wind could contribute 12% of EU electricity by 2020. One-third of this will come from offshore installations. EWEA estimates that wind power both onshore and offshore could contribute to 11-14% (180 GW) of wind power in 2020 (depending on 2020 demand) from a level of 3% (50 GW) at the end of 2006.’ But the EWEA says that ‘the target cannot be met without large-scale offshore wind. Thirteen years is short notice. Strong policy measures must therefore be implemented rapidly.’ It suggests that it is vital to establish a European policy framework for offshore wind power. ‘To guarantee investor confidence, and develop offshore wind farms on a sufficient scale, this sector needs a stable political framework’.
For more see: www.eow2007.info/uploads/media/ewea-offshore_report.pdf
Italy goes for offshore wind
Dutch company Blue H Technologies BV has developed what it says is the first ever large scale prototype Submerged Deepwater Platform (SDP) for offshore wind turbines- see above- to be anchored in 108 meters waters at a distance of 10.6 nautical miles from the coast of Puglia in Southern Italy.
Using mono-piles or jackets or tripods limits potential offshore sites to areas less than 50 meters in depth. But Blue H has developed a new solution by adapting the concept of submerged tension-legged platforms developed by the oil industry for some of its off-shore rigs, and designed a platform large and stable enough to support a tower and a wind turbine. They say that this reduces significantly the overall weight of the structure, a large element in cost the component of offshore wind units- e.g., RE power’s 5MW units weigh approx 2,100 tons; Blue H expects its future deep sea wind energy units, at comparable installed capacity, to weigh less than 800 tons. They can also be assembled onshore and then towed out far offshore, at distances of 10 nautical miles or more and positioned in deep waters. That avoids the need for crane ships and jack-up barges. And it’s easier to dismantle with no leftover elements.
Neal Bastick, CEO of Blue H commented ‘Blue H intends to demonstrate that deepwater offshore wind farms can be built economically and certainly at a cost which is extremely competitive to the shallow water wind farms of today’.
In Jan. 2007 Blue H Skysaver obtained the final authorisations to install its large scale prototype in the water and has now applied for the required authorisations to build a 90MW Wind Energy Park in the same area, 20 km from the coast in waters 100-120 meters in depth. The project has a strong support of the Regional Government of Puglia and the local population. See: http://www.bluehgroup.com
Sources: Future EnergyNews/Modern Power Systems.
Germany imposes green heat targets
From Jan 2009, all new homes built in Germany will be required to install renewable energy heating systems under a new Renewable Energies Heating Law. The government is allocating 350m euros each year in grants for homeowners to install renewable energy systems such as solar panels, wood pellet stoves and boilers and heat pumps.
The new Erneubare-Energien-Warmegesetz ruling means homeowners must use renewable sources to meet 14% of a household’s total energy consumption for heating and domestic hot water. Solar is expected to be the most popular options. Existing houses will also have to be remodeled to incorporate renewable-energy-based heating systems from 2010. For old houses, 10% of the heating and domestic hot water energy needs will have to be provided by renewables. There will be fines of up to 500,000 euros for non compliance with the new law.
Heating buildings accounts for 40% of the total German energy consumption and at present renewables only supply about 6% of this. However the new legislation aims to increase it to 14% by 2020.
Germany continues to be leader in renewable energy and employment in the renewables sector in Germany has almost doubled since 2004, to 249,000 jobs.
But France is bidding to catch up. It aims to increase the renewable share of total energy consumption from 6.7% in 2004 to 20% by 2020, with wind rising from from 810 MW in 2006 to 25,000 MW and PV solar rising from 32.7 MW in 2006 to 3,000 MW by 2020. 5 million solar thermal units will also be installed and biomass use expanded further.
Norway- Carbon Neutral by 2030
Last year Norway set what it called the world’s most ambitious target for cutting greenhouse gas emissions- zero neutral by 2050- by reducing emissions at home and investing abroad in projects to earn Norway CO2 reduction credits. But now, it’s Labour led coalition government has set a new date- carbon neutral by 2030. The plan includes offsetting its emissions by spending $553m p.a. to combat deforestation in developing countries, and it’s now thought that it is realistic to assume a net reduction of 15-17m tonnes of CO2 equivalents by 2020, including forests, compared to initial target of 13-16m tonnes. The government said it would spend $12.91m more this year on research into renewables and carbon capture & storage, and funding for research would rise to at least $100m in 2010.
*Norway is the world’s fifth- biggest exporter of oil and Western Europe’s biggest exporter of natural gas, but gets almost all its own electricity from hydro stations. Source: Reuters
Ireland to be unified
An ‘All-Island Grid Study’ commissioned jointly by the Irish Republic’s Dept. of Communications Energy and Natural Resources, and Northern Ireland’s Dept. of Enterprise, Trade and Investment, looks at the potential of renewables and the role of the electricity grid on a comprehensive ‘island of Ireland’ basis. Irish Energy Minister Eamon Ryan said, ‘This study shows that we can do more than reach our renewable energy targets- we can surpass them. Above and beyond our current target of 33% by 2020, the Grid Study tells us that it is feasible to generate 42% of our electricity from renewable sources by that date. This will be one of the highest levels of renewable electricity in the world. It will reduce our greenhouse gas emissions by 25% in comparison to a ‘business as usual’ scenario.’ But it will be costly: ‘Our electricity systems will require major investment to cater for wind, wave and other renewables. For the Republic alone, additional investment of over €650m will be necessary to reinforce over 600 km of the electricity transmission network. Corresponding investment required from private industry will be in the order of €9bn.’ But ‘this will bring significant savings on our imported fossil fuel bill and present Ireland with new employment and enterprise opportunities’.
Co-operation- after SEM
Northern Ireland and the Republic of Ireland have already set up a single electricity market (‘SEM’)- the first cross-border market of its kind in Europe. It’s claimed that efficiency, supply security and cost-effectiveness will be improved, as will prospects for renewables .
Ryan commented that with the Single Electricity Market ‘we have seen that crucial projects can be delivered on time and to budget when agencies work together. This will require an ongoing effort from my Department, Eirgrid, CER, ESB Networks and SEI to deliver the infrastructural requirements identified in this report. In light of the SEM, we will continue our close co-operation with our northern counterparts as both governments work to fulfill their renewable energy ambitions for their respective systems.’
The report says that in an all-island system, with 1GW interconnection, it’s technically feasible to meet 42% of electricity demand from renewables- with an installed wind capacity of 6GW. But that will need 845km of transmission upgrades, costing just over €1bn.
* It makes sense to integrate the two countries’ grid systems, and plan for the whole island, with a larger combined market making larger projects viable. However some cynics have suggested that this might open the way for a nuclear plant in N Ireland- it is probably too small to support one on its own. Interestingly in this context, the new Nuclear White Paper outlines a programme for ‘England, Wales and Northern Ireland’, given that the Scottish Assembly has indicated it will not support nuclear. Mind you, Northern Ireland is not too keen on nuclear and, like Scotland, the government in the Republic is very anti-nuclear. But things can change. It might even be that a N. Ireland nuclear plant could also supply Scotland at some point, via the new interconnector. Or are we getting paranoid?
Wave energy support for Ireland
Ireland has also launched a major ocean energy programme. Energy Minister Eamon Ryan has pledged over €26m for the sector over the next three years. He said ‘The aim behind this R&D funding is to enable Ireland to win the race of developing a full-scale, commercially viable ocean energy device for generating electricity’. It wants to have 75 MW of wave capacity by 2012 and 500 MW by 2020. In addition to the R&D support, there will be a guaranteed price for wave energy- with a new feed-in tariff of €20/MWh. ‘Ireland now has the most sophisticated state support system for ocean energy in the world,’ said Ryan. ‘The government is supporting start-up research through to the commercial production of electricity from the ocean. We then guarantee a price for this electricity that is one of the most competitive in the world.’ The plan will include €1m towards a National Ocean Energy facility at University College Cork, €2m to develop a grid-connected wave energy test site near Belmullet, Co. Mayo, €2m in grants under the Ocean Energy Prototype Fund to help developers to make their devices commercial, and €0.5m to establish an Ocean Energy Development Unit as part of Sustainable Energy Ireland (SEI).
*Ireland has also extended its feed-in tariff scheme to give €140 /MWh for offshore wind projects, with 15 year contracts.
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