Spread the word on cost of energy

EUROPE: The wind energy market is a big deal for Europe. It contributed €32 billion to the GDP across the EU in 2010 and provided almost 240,000 jobs. Figures from the European Wind Energy Association suggest these jobs could double in number by 2020, and the GDP contribution triple.

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At last month's EWEA 2012, the major European wind industry conference, where 10,000 of those already employed by wind were discussing the industry's future, one topic that kept surfacing was the need to drive down the cost of energy. The message to and from turbine manufacturers was that, if the industry is to continue to grow, new products must be developed that will bring down the cost of operation.

A look around the conference floor showed an encouraging mix of businesses, both established and new to the market, many of which will be the providers of cost-cutting products and services.

If industry can drive down the cost of energy through product innovation, then it will send the message to governments that here is a power source that must be supported — and subsidies are an important factor in the ability of the industry to research new technologies.

But in current economic circumstances, the axe is bound to fall on expensive projects or policies that can be argued as not being strictly necessary — and the world of renewables can too easily be presented as an indulgence. Aspirational, not essential.

If governments wobble in their support of renewable energy, and the existing momentum thus squandered, the long-term objective of providing cheap power from a carbon-neutral source will be lost, along with all those jobs and any longer-term financial and environmental benefit. In short, low cost is the clearest message that can be given to the wider world.

Reaching parity with the cost of gas is one clear aim and there are some who believe that, at least in Europe, this could be achieved before 2020, partly because of the rising cost of gas. And the wind industry has further options. As offshore growth enters a new stage that includes large, far-shore wind farms, there is potential for cost reduction, not just through new technologies, but through scale.

But while the industry is certain that support mechanisms must play a major part in helping the industry to continue to work towards keeping down the cost of wind energy, a round-table discussion involving chiefs of industry returned little agreement on whether this should be in the form of subsidies, targets or taxes. The Danish energy minister, Martin Lidegaard, asked the round-table panel what proposals he ought to take back to his counterparts from other EU countries — what form of subsidy he should request. He didn't really get much help. Out of the mixed messages that the industry sends to governments, at least there appeared to be one clear request: for stability in whatever mechanism is delivered.

The wind industry has grown up in the past few years. It has mature, established markets. And now, as well as continuing to strive for reduced costs, it must turn its attention to ensuring that the wider world is aware of the emphasis within the industry on driving down the cost of wind energy. It needs to communicate and demonstrate to governments and customers that this is the industry's priority.

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