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Comment - EU leaders take heed: wind energy sector is key to growth

EUROPE: As the EC informal growth summit begins this week, wind energy could provide the ideal catalyst to create both jobs while reducing Europe's energy imports, writes EWEA chief executive officer Christian Kjaer.

"Wind energy can create economic activity and jobs" - EWEA CEO Christian Kjaer
"Wind energy can create economic activity and jobs" - EWEA CEO Christian Kjaer

Nothing lasts long in politics. The recent French presidential elections have changed the dynamics of growth versus austerity policies. The newly-elected Francois Hollande now believes that strict austerity measures are not the way to stimulate growth.

At the informal growth summit on 23 May, European leaders will bring their differences to the table to discuss how to achieve growth while addressing massive budgetary challenges.

Every EU citizen is paying more than €700 for energy imports: this is increasing as Europe’s fossil fuel production drops and prices climb. That money would be better spent deploying domestic renewables technologies: reducing imports while reaping the economic benefits of exports.

Job creation costs money

Wind energy can create economic activity and jobs, while saving money. It is, however, very capital intensive. That is a challenge and an opportunity because it means that jobs are created quickly. And those jobs are European.

In 2009, a €4 billion European Energy Programme for Recovery (EEPR) was launched. Of the three areas selected for funding, offshore wind energy, although allocated just €565 million (14% of the budget), created ten times more jobs than Carbon Capture and Storage (CCS).

Onshore wind was not eligible for EERP funding, for reasons only apparent to the Commission staff who drafted the rules in favour of CCS. If EWEA had not got a last-minute reference to renewables included, the EERP would have failed. This approach to growth should not be repeated.

Funds must be leveraged, for example through the European Investment Bank, towards technologies that can make an immediate impact on jobs, while reducing Europe’s fuel import bill: onshore wind energy, then offshore wind energy and investments in electricity infrastructure.

The wind energy sector’s growth rate in 2010 was twice that of EU GDP*. From 2007 to 2010, the sector’s contribution to GDP went up by 33%, reaching €32.4 billion.

As EU employment fell by 9.6% from 2007 to 2010, direct and indirect wind energy jobs in Europe went up 30% to nearly 240,000. Over 50 new jobs were created in the sector daily.

The cost and the benefit

Every Euro spent in the sector generates money elsewhere - €0.28 in the metal industry, for example. The European wind sector is also a net exporter, of €5.7 billion of products and services in 2010. And when you have wind energy, you need less fuel from other countries: wind saved the EU €5.7 bn on fuel in 2010.

By 2020, the sector is expected to have created 520,000 jobs, and its GDP will increase almost three-fold to reach nearly €94.5 bn by 2020.

But to ensure this growth happens, EU and national leaders must provide long-term certainty for energy investors.

How? By avoiding abrupt, and especially retroactive, changes to the ways in which renewable energy is supported. So that investors know they can count on that support.

By putting in place an ambitious and binding 2030 renewables target as part of a legal framework post-2020.

By delivering the necessary grid infrastructure and a functioning European electricity market. The European Commission’s infrastructure package should accelerate permitting and increase financing.

Angela Merkel’s government has supported wind energy and overseen the take-off of the first German offshore wind farms.  Hollande pledged to reduce nuclear’s share of power production from 75% to 50% and to increase renewables. These are good signs.

On Wednesday, EU leaders must recognise that wind energy can guarantee growth. They must support the sector to ensure that growth happens.

Politicians change every few years. But a political commitment made now to the wind energy sector will have long-term and far-reaching benefits across Europe.

*According to EWEA’s report, ‘Green Growth’.

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