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Third time lucky for renewables directive -- Presentation to ministers at last

The most recent proposal for a long awaited European directive on renewable energy has been officially adopted by the entire European Commission, the EU's executive body, and was due to be presented to Europe's energy ministers at their council meeting on May 30. The directive proposal holds no new surprises since energy commissioner Loyola de Palacio outlined the "major principles" in April (Windpower Monthly, May 2000). It aims to double renewables' share of energy consumption within the EU from its present level of 6% to 12% by 2010.

The positive reaction of Competition Commissioner Mario Monti to De Palacio's proposal -- which allows differing levels of support for renewables to continue in each member country for the next five years -- is particularly welcomed by supporters of the proposal. Monti is keen to see full competition on Europe's emerging internal energy market and has previously expressed concern at the differing levels of support on offer.

The directive, however, states that within five years the commission will propose a community-wide system of support after considering the workings of each national system. This cautious approach is the result of bitter lessons learnt after two earlier attempts to create an internal market for renewables trading failed in the face of opposition from renewable energy lobbies anxious to protect their fixed price support schemes.

The major thrust of De Palacio's latest proposal is for national targets for renewables. Within a year of the directive entering force, countries are expected to set targets which must be consistent with the 12% EU renewables objective and its attendant goal of 22.1% of electricity from renewables by 2010. The commission proposes a set of indicative targets for member states. For some countries these are just endorsements of national domestic goals, for others they are more exacting than their existing ones. The commission warns that if a member states fail to meet its share of the overall EU objectives, "individual and mandatory national targets" will be proposed to the European parliament and council.

Other provisions in the directive oblige countries to provide priority access for electricity from renewables, a system of accurate certification of green electricity, streamlined and expedited authorisation procedures for renewable generating plants, and transparent and non-discriminatory grid connection costs for renewable electricity producers.

Muted reaction

Reaction to the proposed directive has been muted, although by postponing its contentious plans for "harmonisation" of support in an internal renewables market, the commission has made the directive more palatable to a wider section of Europe's renewables lobby. "This watered down directive is better than no directive at all," is a typical reaction of government commentators. Some also take the cynical view that the decision to delay harmonisation is a deliberate tactic, leaving the issue of national renewables subsidies to be resolved by the competition commission under its state aid rules.

Danish energy minister Svend Auken says the EC's decision to put back its harmonisation plans is "reasonable" as it provides an opportunity to "collect useful experience." He adds: "There are some clearly difficult proposal negotiations ahead. From our side we will work to ensure the result is as ambitious as possible with regard to stimulating the growth of renewable energy within the community."

The European Wind Energy Association (EWEA) welcomes both the directive's main principles. "The setting of minimum targets and acknowledgement of the importance of subsidiarity in national support schemes are positive developments," says EWEA president Klaus Rave. But there is still a need for mandatory targets, he maintains. EWEA suggests a procedure to convert the indicative targets into binding targets in the short term after discussion with member states. EWEA is keen to collaborate with the commission in its research into the effectiveness of different support mechanisms. But it criticises the directive's definition of support schemes as "subsidies." Their role in compensating for "market failures" must be recognised, it insists.

The German response has so far been warm. "This is a milestone in European energy policy, even if in the detail certain improvements are necessary," says Han-Josef Fell, energy expert for the Greens federal parliamentary fraction. "The European Union makes it clear that its statements are not just lip-service to renewable energies but that renewables do actually have uppermost priority in the energy policy of the commission." Its decision to leave the choice of support mechanism open to member countries "effectively backs Germany's new Renewable Energy Law," he claims.

Waste excluded

The May 30 meeting of Europe's energy ministers is expected to reveal whether all member states are content with the national targets proposed in the directive. For some countries, the technologies allowed as "renewable" could prove crucial: notably absent from the directive's list of renewable definitions is energy from waste.

Among those affected by waste's exclusion would be the UK where over 60% of projects supported so far through its NFFO program are from waste, sewage gas or landfill gas. According to a government official, waste's exclusion comes as an "unpleasant surprise." It had been expected to be among the list of eligible technologies, even though its inclusion would have been controversial and disputed by some countries. Without energy from waste, the UK will certainly be hard pressed to achieve its 10% goal. Moreover, its omission casts even more doubt on the EU as a whole meeting its ambitious targets, he adds.

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