Diffusion of renewable feed-in tariffs in the EU-25 – an
instrumental contribution for the dissemination of
renewable energies
Mischa Bechberger
Research fellow with the Deutsche Bundesstiftung Umwelt, DBU (German Federal
Foundation for the Environment) (www.dbu.de) and the Environmental Policy
Research Centre (www.fu-berlin.de/ffu/index_de.htm) at the Free University of
Berlin, Email: [email protected]
&
Dr. Danyel Reiche
Research fellow with the Deutsche Bundesstiftung Umwelt, DBU (German Federal
Foundation for the Environment) (www.dbu.de) and the Environmental Policy
Research Centre (www.fu-berlin.de/ffu/index_de.htm) at the Free University of
Berlin, Email: [email protected]
Paper presented at the ECPR Joint Sessions of Workshops, April
14-19, 2005, Granada, Spain
Introduction
The goal of increasing the share of renewable energy sources (RES) in total primary
energy supply as well as in electricity production of all European Union (EU) Member
States (subsequently called EU-25) is tried to be reached by means of a mix of
promotion instruments. The most prominent ones in the case of electricity are
renewable energy feed-in tariffs (REFIT) and quota systems.
In March 2005, 16 of the EU-25 countries are using a REFIT system (see table 1), but
only 5 out of 25 EU countries (or even 6, if one consider, that Denmark already since
the end of 1999 has decided for a quota system but since than has postponed several
times its implementation; see also table 1) have adopted quota systems.
What are the main reasons for that kind of diffusion phenomena and why did the
REFITs disseminate in much more EU countries than quota systems did? To answer
this question, we will identify the factors, which led to the diffusion of REFITs and to
the decline of quota systems. Furthermore we ask for the influence of REFITs in
success or failure of renewable energy development. Therefore we analyse the specific
construction of successful REFITs in combination with the general political
framework such as the natural conditions for RES, availability of fossil resources, use
of nuclear power, technological (i.e. grid capacity), and cognitive environment.
Finally we look at the possibilities for a uniform corpus of regulation for RES
electricity valid for all EU Member States after 2005 and if this could be a REFIT
system.
Theoretical approaches
To analyse the stronger diffusion of REFITs in the EU-25 compared to quota systems
the authors refer especially to new approaches on diffusion theory by Tews. She
identifies mainly 3 bundles of factors and their complex interaction as crucial for
diffusion processes: Firstly, international and trans-national factors which connects
countries in the international system in a horizontal and vertical manner and
therefore allows the transfer of political innovations. Secondly, national factors,
which filter experiences from abroad and determine the receptiveness versus external
influences, and thirdly characteristics of the political innovation itself, which may
indicate its “diffusability” (Tews 2005: 66).
In addition we use approaches on success conditions of environmental policy applied to the promotion of RES based on works of Jänicke and own approaches
(Bechberger et al. 2003; Reiche 2004) focusing on further factors influencing the
success of RES promotion like geographical, political, economical, technical and
cognitive framework conditions on the one hand and general structural elements in
the design of RES promotion instruments like long-term security of investments,
technology (and site) differentiated remuneration, compatibility with law and
competition, etc.
Main characteristics of REFITs and quota systems
Regarding the two most important promotion instruments for RES electricity which
are used in the EU-25, they have the following main characteristics:
REFITs show two basic features: Purchase obligation by utilities for RES electricity
and guaranteed premium prices (mostly for a certain time period, e.g. 15 years) for
producers of RES electricity. The specific feed-in conditions (considered RES
technologies, level of remuneration, grid access, equalisation of extra costs of RES,
etc.) are normally part of an own RES regulation.
In the case of quota systems a certain amount or share of RES power is fixed (by the
state) and has to be produced, purchased or bought in a given time period by a
certain group of actors (suppliers, producers, traders or end customers). Quota
systems are normally combined with tradable green certificates (TGCs) mainly to
separate the physical power market from the TGC market and to control the
compliance of the set quota. The specific conditions of quota systems (e.g. fixing of
different quotas for each RES technology, level of fines in case of non compliance of
quota, etc.) are (also) normally set by an own RES regulation.
Diffusion course of REFITs and quota systems
From a chronological point of view, Portugal in 1988 was the first EU country
introducing a REFIT system, which – in an amended version of 2001 – is still in
force. Mostly Germany (REFIT firstly introduced 1990), but also Spain (1994) and
Denmark (1992) can be regarded as model countries for a REFIT approach due to the
effectiveness in increasing the share of RES in the power supply. First of all the
German RES Act (EEG) from 2000 set an example for other countries, which later on
also decided for a REFIT system. This was the case i.e. for the Czech Republic, where
the Czech Renewable Energy Association arranged a translation of the EEG and
distributed it to all members of the Czech Parliament. This fact initiated a discussion
about the promotion of RES through a REFIT system, which finally led to the
implementation of a respective instrument. An even stronger orientation by the
German EEG can be identified in the French case. In a comparative study by the
Member of the French National Assembly Yves Cochet on different RES promotion
models by order of the then prime minister Jospin, the implementation of a REFIT
system was recommended with explicit reference to the success of the German (but
also the Spanish) promotion approach. On the other hand, the study also referred to
the difficulties of implementation of a quota system in the Netherlands, Great Britain
and Italy and its problems to realise clear increases of the RES share on the energy
supply in a relatively short time period (Busch 2003: 7).
But also in the most recent past there are examples for an orientation by model
countries: The amendment of the Spanish regulation for RES electricity of March
2004 is partly orientated by the German Feed-in law of 1990 and the new Czech RES
act – adopted at the end of February 2005 – shows many strong similarities to the
current Spanish RES promotion model as well as to some provisions of the current
German RES law. Before the adoption of the Czech RES act, a couple of meetings
between the German and the Czech environment ministries took place, where the
German side advised the Czech delegation in some critical issues. Also the Spanish
energy regulatory office consulted its Czech counterpart as well as the Czech ministry
of industry and trade on the functionality of the Spanish green bonus model for RES
electricity.
Beside this more trans-national diffusion factors, the repeated increase of EU
countries introducing REFITS since 2001 (7 new introducers)1 can also be explained
by a couple of factors on a macro level: Firstly, the necessity of a systematic support
of renewable energies in the national electricity markets based on the indicative
targets of the European Directive on the promotion of green electricity from
September 2001 and the fact that this EU Directive didn’t include a determination for
one specific RES promotion model. Furthermore, the legal security concerning the
conformity of the German Feed-in law with European law on competition regulations
due to an identical sentence by the European Court of Justice of March 2001 as well
as the great successes mainly regarding the growth in wind power capacities of EU
1
These are France (2001), the Czech Republic, Slovenia (both 2002), Austria, Hungary, the Netherlands (all
2003) and Cyprus (2004).
countries like Germany, Spain or Denmark – which all used REFITs – convinced
other EU member states to introduce such a RES promotion instrument.
Besides the 16 countries in the EU-25 with a REFIT system in force in March 2005,
some more countries, which meanwhile changed their RES promotion approach, also
used a REFIT system. This applies to Italy (between 1992 and 2001), Ireland (until
end of 1994) and Poland (1993 – 2001) (Bechberger et al. 2003; Busch 2003).
A historical glance concerning the diffusion of quota systems reveals a quiet different
situation. The first EU country, which decided for such a RES promotion model was
the Netherlands in 1998. But the Dutch attempt to support the development of RES
by a quota system only lasted three and a half year, because in July 2001 the
Netherlands changed to a more demand orientated RES policy based on energy tax
exemptions for green power. Nevertheless between 1998 and 2001 (much) more EU
countries (six)2 introduced a quota system than a REFIT (two)3. There are mainly
three reasons for the dominance of quota system diffusion during this period: Firstly,
the European Commission – as one very important external actor regarding the
diffusion of policy innovations – already in a first unofficial draft of an EU-Directive
for the promotion of RES in the internal electricity market of October 1998 preferred
a RES support model based on quota systems. This fact clearly hampered the further
diffusion of REFITs as EU Member States feared costly administrative adjustments to
a possible EU wide quota model if – before the adoption of the EU-RES Directive –
would have introduced a REFIT system. Secondly and also in 1998, the resistance of
German energy suppliers against the recently amended German Feed-in law (StrEG)
reached the European level: The then German supplier PreussenElektra filed a
lawsuit against the StrEG by the regional court of Kiel, which forwarded the case to
the European Court of Justice (ECJ). Not until March 2001 the ECJ decided that the
StrEG was no state subsidy and therefore conform with European competition
regulations. Until this sentence there was no legal security for countries thinking
about the implementation of a REFIT. Thirdly, the international economic
respectively neo-liberal framework conditions benefited the diffusion of quota
systems because they (in economic theory) are normally perceived to comply better
2
These were the Netherlands (only between 1998 and 2001), Denmark (2000, but several times postponed),
Austria (only between 2000 and 2003), Belgium, Poland and Italy (all 2001). The Belgium quota system also
have partly similarities with a fix price system as minimum prices for the tradable green certificates were set,
depending on the respective RES technology (de Lovinfosse et al. 2005, forthcoming).
3
These were Estonia (1998) and France (2001).
with the conditions of international trade, market mechanisms and competition (in
general) than REFITs (Busch 2003; Reiche 2002; Van Sambeek/Van Thuijl 2003).
After this first “diffusion wave” of quota systems between 1998 and 2001, two more
EU member states opted for such a RES support model: The UK in 2002 and Sweden,
as the most recent example for a country with a quota system, which started in May
2003 (Mortimore 2003).
Table 1: EU countries with REFITs or quota systems in March 2005
(Reiche/Bechberger 2005, forthcoming).
Country
Feed-in tariff
Quota obligation +
certificate trading
Austria
●
Belgium
●
Cyprus
●
Czech Republic
●
Denmark
●
Estonia
●
Finland
●
France
●
Germany
●
Greece
●
Hungary
●
Ireland
Italy
●
Latvia
●
Lithuania
Luxembourg
●
Malta
Netherlands
●
Poland
●¹
Portugal
●
Slovenia
●
Slovakia
Spain
●
Sweden
●
United
●
Kingdom
● = deployed promotion instrument;
= introduction is planned; ¹ Poland still has
to introduce a certificate trading systems
Principal driving forces and obstacles for an increased RES use in the EU25
Besides the simple use of RES promotion instruments themselves (like REFITs or
quota models) used in the EU-25, a series of further factors influence the success or
failure of RES development. Regarding this, in recent research the authors identified
a couple of other criteria: This are on the one side the specific design of the
promotion instruments itself and on the other side geographical, political,
economical, technical and cognitive framework conditions.
Favourable design of RES promotion instruments
Even there is no natural superiority of any (RES) promotion instrument, until now
REFITs have shown the best effectiveness concerning the creation of new RES
installations: The leading wind energy countries Germany and Spain have installed
successful REFIT systems and almost all old installations in Denmark are based on
this system, too. Nearly 82 % of all wind power capacity in the EU-25, accounting to
34,205 MW at the end of 2004, was installed in these three countries (EWEA 2005).
Table 2: Installed wind power capacity in the EU-25 by the end of 2004 in MW
(EWEA 2005).
Total at end 2003 Installed Jan.-Dec. Total at end 2004
2004
Austria
415
192
606
Belgium
68
28
95
Cyprus
2
0
2
Czech Republic
9
9
17
Denmark
3,115
9
3,117
Estonia
2
3
6
Finland
52
30
82
France
253
138
386
Germany
14,609
2,037
16,629
Greece
375
90
465
Hungary
3
3
6
Ireland
191
148
339
Italy
904
221
1,125
Latvia
26
0
26
Lithuania
0
7
7
Luxembourg
22
14
35
Malta
0
0
0
Netherlands
910
197
1,078
Poland
63
0
63
Portugal
296
226
522
Slovakia
3
3
5
Slovenia
0
0
0
Spain
6,203
2,065
8,263
Sweden
399
43
442
UK
648
240
688
EU-15
28,460
5,678
34,073
EU-10
108
24
132
EU-25
28,568
5,703
34,205
Note: Due to previous-year adjustments, project decommissioning of 65 MW and
rounding, the 2004 end-of-year cumulative capacity total does not exactly match
the year-end 2003 total plus the 2004 additions.
What are the reasons for this impressive development? In the first place this is the
planning security the three countries offered possible investors with the specific
design of their REFITs. Germany, for example, guarantees investors the feed-in tariff
for a period of 20 years (and even 30 years for hydro until 5 MW). The new Spanish
REFIT even guarantees fixed remunerations for the whole lifetime of a RES
installation. Concerning the new EU member states, only Hungary (8 years) and
Estonia (7 years for biomass and hydro, 12 years for all other RES) offer investors
long-term security. On the contrary, the Czech Republic and Slovenia - which also
use REFITs - decide on their remuneration on a year by year basis, which is no
investment security at all. Accordingly, in these two countries until now there has
been hardly any new RES installations since the implementation of a REFIT. Mainly
for that reason the Czech Republic is amending its present REFIT to a system similar
to the Spanish one, which will also include a remuneration guarantee for 15 years
(Platts 2005: 5).
Another very important design criteria for a successful RES development of several
kind of RES technologies is the technology-specific remuneration for RES electricity.
If the different power production costs of the individual RES technologies are
considered in the form of varying remuneration, the possibilities to reach a broad
RES supply or technology mix seem without doubt higher than with a uniform
remuneration level for RES power. For example in Germany, the EEG established a
broad promotion approach with remuneration rates depending on the technology
used, the size of the plant and in the case of wind energy in addition also depending
on the age and the generated power output of the installation. The success of these
provisions speaks for itself: world champion in installed wind capacity (Bechberger et
al. 2004a). Also for photovoltaic electricity, whose production costs are still much
higher than those of hydropower, wind, and biomass, the REFIT systems of Germany,
Portugal or Luxembourg, for example, offer an adequate feed-in tariff. In 2004,
photovoltaic power received the highest payment per kilowatt hour in these
countries, 0.499 € in Portugal, 0.62 € in Luxembourg, and up to 0.624 € in Germany,
which is the highest payment among the Member States. As a consequence, in 2004
Germany was for the first time world leader in the annually installed PV capacity,
with around 300 MWp of new capacity, outpacing even Japan (with some 280 MWp
of new PV capacity installed) (Reiche/Bechberger 2005, forthcoming).
Political success conditions for RES
Taking into account the several political factors influencing the success or failure of
RES development, it is important to look for the pressure from international
obligations. The Kyoto Protocol can not be seen as a driving force for renewable
energy development in the new EU countries because they have already reached far
more CO2-reduction than necessary (with the exception of Slovenia) whereas ten out
of 15 EU Member States are behind their obligations set in the so-called “BurdenSharing Agreement” of June 1998 (EEA 2004, see table 3).
Table 3: Greenhouse gas emissions of EU-25 countries in CO2 equivalents (LUCF)
and Kyoto Protocol targets for 2008-2012 (EEA 2004: 11; European Commission
2004a: 20).
Member State
Base year
(million
tonnes)
2002
(million
tonnes)
Change
2001 - 2002
(%)
Change
base year –
2002 (%)
Austria
Belgium
Cyprus
Czech Republic
Denmark
Estonia
Finland
France
Germany
Greece
Hungary
Ireland
Italy
Latvia
Lithuania
Luxembourg
Malta
Netherlands
Poland
Portugal
Slovakia
Slovenia
Spain
Sweden
UK
78.0
146.8
5.1
192.1
69.0
43.5
76.8
564.7
1,253.3
107.0
113.1
53.4
508.0
28.9
50.9
12.7
2.2
212.5
565.3
57.9
72.3
20.6
268.8
72.3
746.0
84.6
150.0
8.3
142.8
68.5
19.5
82.0
553.9
1,016.0
135.4
78.0
68.9
553.8
10.6
20.2
10.8
2.8
213.8
382.8
81.6
51.9
20.4
399.7
69.6
634.8
+0.3
+0.5
+2.6
-3,5
-1.2
+0.3
+1.7
-1.4
-1.1
+0.3
-1.2
-1.6
-0.1
-1.1
-2.6
+10.4
+13.1
-1.1
0.0
+4.1
-0.8
+0.6
+4.2
+2.0
-3.3
+8.5
+2.1
+63.9
-25.7
-0.8
-55.2
+6.8
-1.9
-18.9
+26.5
-31.0
+28.9
+9.0
-63.1
-60.2
-15.1
+28.5
+0.6
-32.3
+41.0
-28.2
-1.1
+39.4
-3.7
-14.9
Targets 20082012 under Kyoto
Protocol and EU
“burden sharing”
(%)
-13.0
-7.5
-8.0
-21.0
-8.0
0.0
0.0
-21.0
+25.0
-6.0
+13.0
-6.5
-8.0
-8.0
-28.0
-6.0
-6.0
+27.0
-8.0
-8.0
+15.0
+4.0
-12.5
EU-15
EU-25
4,245.2
5,334.1
4,123.3
4,852.4
-0.5
+0.02
-2.9
-9.0
-8.0
-
Note: All Member States have ratified the Kyoto Protocol, 23 have emissions
reduction targets under the Kyoto Protocol. In addition, the Community is a Party
to the Kyoto Protocol. The Community target includes only the EU-15 Member
States. For the EU-15 the “burden sharing” target is an 8 % reduction of their GHG
emissions from the base year level. Most new Member States have committed
themselves to reducing their greenhouse gas emissions by 8 % from the base year
level in the first commitment period 2008–2012 of the Kyoto Protocol. Hungary and
Poland intend to reduce their emissions by 6 %. Cyprus and Malta are Non-Annex I
Parties to the UNFCCC and thus do not have a target under the Kyoto Protocol.
Promoting the CO2-free or neutral renewables is one way for them to fulfil the
obligations from the Climate Convention. In contrast to the Kyoto Protocol, the EUDirective on the promotion of electricity produced from renewable energy contains
ambitious targets for the EU Member States (an increase in RES electricity to the
total power consumption from 13.9 % in 1997 to at least 22 % in 2010) as well as for
the Candidate Countries (from 12.9 % in 1999 to 21 % in 2010) and may become a
crucial success condition for renewable energy development. Table 4 shows that this
is a big challenge for all countries; even the forerunners have to improve their RESperformance noticeably. The required increase for Portugal seems very small; this is,
however, a significant challenge since the electrical consumption is expected to
continue to grow on a high level during the next years. In Greece, Ireland and Spain
the electricity demand is also still rising, whereas the markets in countries like
Austria and Sweden are characterised by stagnation and over-capacities. In its first
formal assessment on Member States' performance on the 2001 renewable energy
Directive issued at the end of May 2004, the Commission mainly concluded that the
EU-15 will significantly miss the target to generate 22 % of electricity from
renewables by 2010 (respectively 21 % for the EU-25) under current policies and
measures, even under a scenario that builds in reductions in total electricity demand
as a result of new energy efficiency measures. This is mainly due to a slower market
development in the field of biomass electricity. Instead the EU is likely to reach only
18-19 % renewable electricity penetration by the end of the decade, according to the
report. The figures equate to a 10 % renewables share of total EU energy
consumption, against a target of 12 %. All but four member states (Germany,
Denmark, Spain, Finland) are set to miss their national renewable electricity targets
(European Commission 2004b: 14).
Table 4: Production of electricity from renewable sources at the end of 2002 in the
EU-25. Share in gross consumption of electricity (source: European Commission
2004c: 46).
Country
Austria
Belgium
Cyprus
Czech Republic
Denmark
Estonia
Finland
France
Germany
Greece
Hungary
Ireland
Italy
Latvia
Lithuania
Luxembourg
Malta
Netherlands
Poland
Portugal
Slovakia
Slovenia
Spain
Sweden
United
Kingdom
EU-25
Hydro*
Wind
Biomass Geothermal
65.4
0.4
0.0
3.9
0.1
0.1
12.4
12.8
4.0
4.9
0.5
3.6
12.1
39.0
3.3
1.8
0.0
0.1
1.7
16.4
18.8
25.1
9.3
44.0
1.2
0.3
0.1
0.0
0.0
13.1
0.0
0.1
0.1
2.7
1.1
0.0
1.5
0.4
0.2
0.0
0.4
0.0
0.8
0.0
0.8
0.0
0.0
3.5
0.4
0.3
2.6
1.9
0.0
0.8
6.6
0.4
11.2
0.7
1.3
0.0
0.2
0.3
0.7
0.2
0.0
1.0
0.0
2.7
0.4
3.6
0.0
0.8
1.8
2.6
1.3
9.9**
1.2**
1.6**
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
1.4
0.0
0.0
0.0
0.0
0.0
0.0
0.2
0.0
0.0
0.0
0.0
0.0
Total
2002
68.3
2.3
0.0
4.6
19.8
0.5
23.7
13.6
8.1
6.1
0.7
5.5
14.7
39.3
3.3
3.2
0.0
3.6
2.1
21.0
18.8
25.9
14.6
47.0
2.9
Target
2010
59.2
1.2
6.0
8.0
23.0
5.1
23.4
13.5
9.0
10.7
3.6
8.9
14.4
49.3
7.0
2.7
5.0
3.8
7.5
41.8
31.0
33.6
26.2
42.7
2.9
Ø 0.2**
12.9**
21.0**
* Does not include pumped storage.
** Based on gross electricity consumption of all EU-15 countries
In most of the EU-25 permit procedures belong to the biggest hurdles. In Poland, for
instance, between ten and sixteen different permits on local, regional and provincial
level are required to apply at the Energy Regulatory Authority for a concession to
build wind turbines. In Greece, another example of very complicated bureaucratic
licensing, RES-installations require the agreement of more than 35 public-sector
entities on central, regional, prefectural and local level; in addition the agreement
needs to conform to four national laws and seven ministerial decrees.
The lag behind schedule of most of the EU Member States in fulfilling the RES-E
target for 2010 can therefore also be explained with the continuity of several
administrative and grid barriers for RES-E installations. In its communication to the
Council and the European Parliament regarding the performance of the EU Member
States on the 2001 renewable energy directive issued at the end of May 2004, the
European Commission concluded that – based on the national reports – in several
cases, the further take-off of RES-E is still blocked by complex licensing procedures,
poor integration of electricity from renewable energy in regional and local planning
and opaque grid-connection procedures (European Commission 2004b: 16).
The administrative responsibility for renewable energies lies with the Ministry of
Economic Affairs in almost all EU-25 countries. This might be an obstacle for the
further development of renewables because there are often close connections between
Ministries of Economic Affairs and the traditional energy supply companies.
Furthermore, top priority of politicians responsible for economy is most often costefficiency. This perspective is a disadvantage for renewables, which are still more
expensive than fossil and uranium energy (if external costs are ignored). Therefore, it
might be a condition of success if the topic RES is mainly anchored in the Ministry for
the Environment (as in Germany since the elections in autumn 2002) or if there is a
separate Energy Ministry like in Denmark until 2001.
Participation of Green Parties in governments might be another advantage for the
development of renewables. The main impulse to phase out nuclear energy in
Belgium and Germany came from the Green Party when they had a power sharing
role in the national government4. The new attractive promoting system for
renewables in France was also only possible with the support of the Green Party,
which was in power until 2002. But there are also examples of successful
conservative governments regarding renewables, as the wind energy development in
Spain (before 2004) and in Germany (before 1998) shows.
4
In Germany the Greens are still in power but not in Belgium (only until May 2003).
Natural success conditions for RES/starting position in energy policy
There are seven countries without nuclear power stations in the EU-15 and six
countries without nuclear power stations among the new EU member states. Some of
them such as Austria, Latvia and Portugal (hydropower), Denmark (wind energy) and
Cyprus (solar) belong to the countries most successful in renewable energies in
Europe. There are seven countries, which decided to phase out the utilisation of
nuclear power: Austria, Belgium, Germany, Italy, Lithuania, the Netherlands, and
Sweden. In Bulgaria and Slovakia nuclear capacity is going to be reduced. In the
accession process to the European Union phasing out nuclear power was a key issue.
To shut down the least safe reactors became part of the accession agreements. Until
2009 eight reactors – which is more than a third of all nuclear reactors of the ten new
EU Member States – have to be shut down5 (there will be financial support from the
European Bank for Reconstruction and Development, EBRD, for the decommission
of the reactors). This requirement from the EU might become one of the main driving
forces for future RES development (Reiche 2003: 18 et seq.).
Table 5: Number of nuclear units and contribution of nuclear power to electricity
generation in the EU-25 at the beginning at the end of 2003 (source: IAEA 2005).
Country
Austria*
Belgium*
Bulgaria
Cyprus
Czech Republic
Denmark
Estonia
Finland**
France
Germany*
Greece
Hungary
Ireland
Italy*
Latvia
Lithuania
Luxembourg
5
Number of nuclear units
connected to the grid in
2003
0
7
4
0
6
0
0
4
59
18
0
4
0
0
0
2
0
Nuclear share of total
electricity supply in % in
2003
0
55.5
37.7
0
31.1
0
0
25.5
77.6
30.2
0
32.7
0
0
0
79.9
0
In this regard, Bulgaria already shut down 2reactors (Kozloduy 1 and 2) at the end of 2002 and will
decommission two more (Kozloduy 3 in 2006 and Kozloduy 4 in 2008). Also Lithuania already closed its oldest
nuclear power plant, Ignalina 1, at the end of 2004 and have to shut down Ignalina 2 in 2009. Furthermore
Slovakia must close two of its six reactors in 2006 (Bohunice 1) respectively in 2008 (Bohunice 2) (Reiche
2003: 17 et seq.).
Malta
0
0
Netherlands*
1
4.0
Poland
0
0
Portugal
0
0
Slovakia
6
57.4
Slovenia
1
40.4
Spain***
9
23.6
Sweden*
11
49.2
United Kingdom
31
23.9
EU-15 Total
163
Ø 21.9
*
These countries’ governments have decided to phase out nuclear power.
**
The Finish parliament decided to build one further nuclear power station in
May 2002.
***
In Spain, a moratorium on the government decision to build five new nuclear
power stations has been in force since the Chernobyl disaster in 1986.
Another driving force for an increase RES use in the EU-25 countries is their
dependency on energy imports. In 2002, already 48 % of all fuels of the EU-25 had
to be imported, with oil imports already reaching 76.8 % of the total oil demand
(European Commission 2004c: 31)6. In this regard, a stronger utilisation of RES can
help to reduce the growing EU energy import dependency and at the same time to
contribute to the security of energy supply, one of three main pillars of EU energy
policy.
Cognitive success conditions for RES
Success or failure of a stronger use of renewable energies is also very much
dependent of the public awareness versus RES. Although opinion polls show a very
positive attitude and support of renewables by the general public, this attitude seems
to have a strong NIMBY (“Not-In-My-Back-Yard”) component. There are especially
local resistance movements against wind energy projects. Reasons given are visual
intrusion, noise, land devaluation, health problems to people and animals due to
radiation, negative impact on local tourism, etc.
In Denmark there are more than 3,000 co-operative wind turbines and between
100,000 and 150,000 owners of them. As of 2002, about 85 percent of the installed
wind capacity in Denmark was established through local initiatives and owned by
farmers or cooperatives. In the same year, at least 340,000 Germans had already
6
The EU statistics on the energy dependency of the EU-25 countries does not count nuclear fuels as imports.
Taking into account that most of the natural uranium has to be imported, the real import dependency on primary
energy carriers of the EU-25 is much higher than the official figure.
invested about € 12 billion in renewable energy projects (Savin 2004: 25). These cooperative models increased the acceptance of wind energy. Another experience in
Portugal, France and Spain for example, is that small hydropower is more accepted
than large plants. A crucial question is whether people are willing to pay higher prices
for renewables. 30 per cent of the Dutch households had already decided for green
electricity until the end of 2003. This is the highest percentage among the Member
States.
By way of contrast, the public awareness is so far only developed on a low level in the
new EU member states (with the exception of Cyprus and partly Latvia). The weak
environmental consciousness is due to an unfavourable socio-economic situation in
most of the Candidate Countries, an absence of adequate education and public
information efforts in the past. In Poland, for instance, in spite of nearly 40 million
inhabitants, the biggest environmental organisation has only 2,900 members.
Policy can influence public awareness with tax exemptions for renewables, which
reduces the additional costs for green electricity or biofuels. An interesting
innovation comes from Austria: electric bills for end users must contain information
about the electricity mix offered. If customers can see that they receive electricity
from nuclear or coal power stations, some might change to another company. It also
limits the credibility of energy companies such as E.ON that advertise renewable
energy sources but sell mainly conventional energy. In its Directive on the
liberalisation of the internal EU electricity market of June 2003 (2003/54/EC) the
European Parliament and the Council followed the Austrian model: The Electricity
Directive introduced the obligation on suppliers to specify the fuel mix and its related
environmental impact of the electricity they sell to final consumers (European
Communities 2003).
The most important cognitive condition for success might be that a general change in
the use of renewable energies is starting to take place: from decentralised to more
centralised applications. This reduces prices in some cases, and in any case fits the
dominant belief system of the energy industry. Co-combustion of biomass and
offshore-wind energy is compatible with the traditional large-scale system. Offshorewind energy is a realistic perspective for all EU countries with the exception of
Austria, Luxembourg the Czech Republic, Hungary, and Slovakia all of which have no
coasts. There are first experiences in co-combustion of biomass in coal power plants
in Hungary, for example. In the Netherlands there is an agreement between
government and producers that coal plants have to be as efficient as gas plants by
2010. Therefore, the producers are forced to co-combust biomass. But one should not
only concentrate on these large scale options supported top-down. Wind energy
development in Germany and Denmark or solar energy development in Cyprus
showed that bottom-up initiatives may be a crucial success condition. Other
renewables as photo-voltaic will not fit into the large-scale system. Therefore, it is
also important that their development is supported bottom-up in the future.
Technical differences
A very important obstacle in some countries is the present grid capacity. In France,
for example, grids were not designed to take in decentrally produced electricity but
mainly to distribute centrally produced electricity. In Spain, for example, it is
questioned that all of the 13,000 MW wind target for 2010 could be reached if no
measures for a net extension will be taken. A first innovative step to solve this
problem consists in a new financing scheme where all investors with a building
permission for one region pay together for the accession to the grid or for a necessary
grid enlargement, which reduces the costs for all involved actors. More of those
forward-looking concepts to finance net reinforcements are still missing but are of
crucial importance for the further growth of RES (Bechberger/Reiche 2004).
Insufficient technologies and higher costs are a significant problem for photovoltaic
and energy from tides or waves. However, wind energy shows that vast technological
development is possible within only one decade. In Germany, the average investment
costs of a wind energy plant was reduced from 2,150 €/kW in 1990 to 865 €/kW in
1999. The average capacity of new wind energy plants increased by more than a factor
of ten during the same period. The Wind Force 12 study, elaborated by the European
Wind Energy Association (EWEA) and Greenpeace, estimated further cost reductions
regarding investment costs of wind power plants of more than 70 % until the year
2020 (EWEA/Greenpeace 2003: 34).
The main success conditions and hurdles for an increase use of RES are again
summarised in table 6:
Table 6: Driving forces of renewable energy development in the EU-25 (Bechberger/Reiche 2003).
Country
Import
dependency
> 50 % (all
fuels
Austria
Belgium
Cyprus
Czech Republic
Denmark
Estonia
Finland
France
Germany
Greece
Hungary
Ireland
Italy
Latvia
Lithuania
Luxembourg
Malta
Netherlands
Poland
Portugal
Slovenia
Slovakia
Spain
Sweden
1 This
●
●
●
Nonexistence of
nuclear
power
stations (●)
or decisions
to shut
down
reactors
(●●)
●
●●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
3
●●
●
Natural conditions for RES
Own Coast
(favourable
wind
conditions)
/offshore
windpossibilities
Agricultural
land more
than 40 per
cent of the
territory
(favourable
biomass
conditions)
Favourable regulation
Technology
specific
payment
●
●
●
●
●
●
●
●
●
Favourable
payment
●
●
●
●
●
6
●
●
●
●
●
●
●
●
●1
2
●
●
●
●
●
●
●
●
●4
●
●
●5
●
●
●
●
●
●
●
●
●
●
●●
●
●
●●
●
●
●
●●
Longterm
security
●
●
●
●
●
●5
●
●
●
●
●
●
●
●8
●
●
International
obligations
Kyoto
EUProtocol
Directive
on RES
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
Cognitive environment
Public
Awareness on
RES
●
Green
parties
in
parliament
Environmental
Ministry
responsibl
e for RES
policy
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
does not apply for PV power; 2 Belgium introduced technology specific minimum prices for its green certificates; 3 The Finish parliament decided to build
one further nuclear power station in May 2002; 4 This applies only for wind power in overseas regions; 5 This applies only for wind power; 6 This does not apply
for PV power; 7 In Spain, a moratorium on the government decision to build five new nuclear power stations has been in force since 1984; 8 This applies only for
wind power on windy sites and solar thermal electricity; 9 This applies only for the long time horizon of the British quota system until 2027.
●
Conclusions and perspectives
Since the introduction of the first REFITS in 1988 in Portugal, this RES promotion
instrument disseminated in the majority of EU-25 (with the exception of the years
1998-2001 for the shown reasons) mostly because of the (long-term) security given
for potential investors if REFITs are designed accordingly (like in Germany or Spain),
its therefore better performance in a rapid RES market creation/stimulation and the
(empirical) evidence of its successful deployment in some EU countries like Germany,
Spain or Denmark. But beyond the favourable design of the promotion instrument
itself, several other factors - as shown above - influence success or failure of the RES
development in the EU-25.
Beside the GHG reduction commitments of the EU Member States in the scope of the
Kyoto-protocol, mainly the EU-RES-Directive (2001/77/EC) serves as a driving force
for an increased use of RES-E as for the first time it introduced indicative targets for
the share of RES-E until 2010. From about 2005 onwards, due to the report on the
success of the different RES promotion systems currently in use in the EU, as
provided in the EU-Directive 2001/77/EC, a Community framework on support
schemes for RES electricity may be proposed which in the medium and long-term
would further bring down RES prices. But even with the beginning of the EU wide
emissions trading scheme in 2005 and its possibilities of linkage with an EU-RES
quota system after 2005 – the existence of different RES promotion systems in the
EU-25 is likely to continue also after 2005, mostly because of different regulation
traditions and successes with the respective promotion system in the EU Member
States. A similar view was recently mentioned by the new EU commissioner on
energy, Andris Piebalgs, who expressed - with regard to the Commission’s
Communication on the financing of renewable energy sources to be published by the
end of October 2005 – that although a strong support to renewable energy sources is
needed, he believes that it would be premature to propose a harmonised European
support scheme (European Commission 2005). Nevertheless, such a harmonisation
on EU level after 2010 to minimize transfer costs of a stronger RES use for society
might be reached. For example a combination of REFIT schemes with quota systems
in a medium to long term perspective will be introduced on EU level with (national)
REFIT schemes for photovoltaic electricity and other RES technologies still far from
the market and a European quota system with TGCs for RES technologies already
close(r) to the market.
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