General Overview:New European Energy Initiatives

New European Energy Initiatives

The EU implemented in 2008 a group of new energy initiatives. These initiatives are the following:

European Wind Initiative: This initiative will focus on the use of large turbines and large systems validation and demonstration (relevant to onshore and offshore applications);

Solar Europe Initiative: This initiative will focus on the use of large-scale demonstration for photovoltaic and concentrated solar power for electricity generation;

Bioenergy Europe Initiative: This initiative will focus on the use of the next generation of biofuels within the context of an overall bioenergy use strategy for electricity generation;

European CO2 Capture, Transport, and Storage Initiative: This initiative will focus on the whole system requirements, including efficiency, safety,

and public acceptance, to prove the viability of zero emission fossil fuel power plants at industrial scale;

European Electricity Grid Initiative: This initiative will focus on the development of the smart electrical system, including storage, and on the creation of a European Centre to implement a research program for the European transmission network; and

Sustainable Nuclear Fission Initiative: This initiative will focus on the development of Generation IV nuclear technologies for electricity generation (COM 2007).

The energy requirements of the different countries are now so high that, for the first time in the history of the humankind, there is a need to consider different types of available energy sources and their level of reserves to plan their economic and social development. At the same time, the use of different energy sources for electricity generation should be done in the most efficient and economic possible manner in order to sustain that development. To achieve that goal, in the particular case of the EU, it is indispensable to adopt and implement a correct European energy policy and strategy.17

The above initiatives have the aim to increase the use of renewable energy sources for the generation of electricity within the EU. To achieve that goal will require European electricity policies to incorporate a long-term perspective and a broader geographical scope. Current short-term horizons serve to limit investment confidence and activity. The EU will need a vision through to 2050, with broad stakeholder involvement in its development. At a more detailed level, clear guide- lines and principles would then support the design of regional generation capacity, demand management, the types of market in operation, how the electricity would be supplied, and finally how transmission grids should look and operate.

The development of such a vision will provide a significant boost to a renewables transition, particularly if this is designed with an EU wide (rather than a national) electricity system in mind. It is likely to result in increased efficiency and effectiveness of the regional power markets, which can make a significant contribution to the security of supply concerns, if accepted as part of the regional solution.

There is also a need for more efficient and effective regional power markets, which not only provide predictability and stability for participants, but also create a level playing field for renewables entering the market. Although the European markets are liberalized and theoretically competitive, in reality, most markets do not function in the way that they need to. This is despite various EU market directives (which are embodied in the second and third energy packages) that provide the policy framework needed for power market liberalization and competition.

For a competitive electricity market to develop at the pace required to support an increase in the participation of renewable energy sources in the EU energy mix vision, as a first step, there is an urgent need for both the spirit and the letter of these directives to be implemented more rigorously. Europe could introduce and enforce penalties for non-compliance, to encourage EU member states to implement the directives in a timely manner. There is also a need to think about further measures that will support a long-term and international vision for the future power system. This will require addressing a number of controversial questions, including whether Europe wants a fully liberalized power market or whether some form of regulation would be more conducive to a rapid transition to a low- or zero- carbon sector. It will also need to address the structure and ownership of the sector and in particular of the grid.

On the other hand, and in order to increase the use of renewables in the energy mix of all EU member states, the EU heads of states have agreed targets for the EU to reduce carbon dioxide emissions, raise efficiency, and deploy renewables by 2030. Coming on top of targets for 2020, a new binding goal to reduce carbon dioxide emissions by 40 % compared to 1990 levels by 2030 has been adopted, while an “indicative” and non-binding target should raise efficiency to 27 % against the same baseline. Renewables should be deployed to make up a total of 27 % of EU energy by 2030 under another binding target. The goals were agreed by the European council of member states’ leaders bringing a positive message to the international climate negotiations—the UN Climate Change Conference to be held in Paris in 2015.

Nuclear power from reactors produces over half of the EU’s low-carbon electricity, but the use of this type of energy source was not mentioned in the announcements made containing the decision adopted by the EU head of states. FORATOM, the nuclear trade body for the EU, said the renewables target “creates a distortion of the market and fails to create a level playing field for all low-carbon technologies.” The goals have a measure of technology neutrality in that they are for the EU as a whole and the contribution of each of the EU-28 member states will be different according to its financial circumstances and its right to determine its own energy mix. According to FORATOM source, nuclear power is “a com- petitive, reliable and baseload source of energy that will continue to make a major contribution to all three pillars of EU energy policy.”

The overarching mechanism to push for reductions in emissions is to remain in the European Trading System (ETS), which will reduce the maximum covered emissions from the EU by 2.2 % per year from 2021 onward, an increased rate of decarbonization compared to the 1.74 % per year currently. The council said the ETS is to be complemented with a mechanism to stabilize the market. In recent years, the price to purchase the right to emit a tonne of carbon dioxide has been low, suppressed by reduced demand for energy as well as rules that have granted

generous permits to existing fossil-fired power plants. These free allowances are to remain, but should be scaled back over time, continuing to 2030 only for countries with incomes below 60 % of the EU average. The same group of nations will have 2 % of ETS allowances earmarked to encourage badly needed investment. Some 10 % of the allowances will be earmarked for countries with GDP below 90 % of the average.

To support the renewable target, the integration of rising levels of intermit- tent renewable energy requires a more interconnected internal energy market and appropriate backup, which should be coordinated as necessary at regional level. It is particularly concerned about the integration of the Baltic States, Portugal, and Spain, as well as Greece and the islands of Malta and Cyprus. Achieving a fully functioning and connected internal energy market is a priority for which all efforts must be mobilized as a matter of urgency.

The transition to renewables relies heavily on the development of an interna- tional, and subsequently an intercontinental transmission grid. However, today, it is almost impossible to build a single transmission line, especially across national borders, as a result of inefficient regulation and public opposition. There is an urgent need to increase political cooperation between countries to improve the efficiency of legislation and permission processes for new transmission projects.

The development of consistent standards for infrastructure planning and per- mitting will make grid expansions across the border less problematic, but changes to make the process more streamlined will certainly be necessary. In addition, mechanisms to improve incentives to invest in and build grid connections at local, national and regional scales are also required.

In some cases, this may require additional financial incentives for TSOs to ensure the delivery of key projects. There is also a need for greater engagement with citizens to understand public opposition to new developments and find ways to make projects more acceptable to the local communities. Mechanisms such as benefit sharing and community involvement in the planning processes need to be explored further, and the development of new legislation needs to take citizens’ rights into account: Codevelopment of a solution to this underlying problem will be crucial to achieving any significant renewables-based vision (PIK 2011).

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