To open a policy debate on what happens next, the Commission is preparing a communication on renewable energy, for an expected publication next month.
A draft version, which may change, predicts that unless new policy goals are agreed until 2030, a business-as-usual scenario would limit the growth of renewable energy to a 25% share of Europe’s energy mix by 2030, and a 29% stake by 2050.
The sector's growth would decline from 6% per year this decade, to only 1% per year between 2020-2050, reducing job creation and increasing dependency on foreign imports.
Between 2007 and 2010, as unemployment soared, over 50 new jobs were created in the wind industry alone daily.
The communication also considers other options, graded up to a full update of the targets, backed by financial support schemes.
The Commission estimates that about €100 billion will be needed for new electricity transmission lines alone.
The EU's multi-annual budget for 2014-2020 should include around €9 billion for spending on energy infrastructure projects, which impact across member states’ borders.
Figures in the renewables sector would like to see this money earmarked for electricity projects.
New policy regime
The energy commissioner Günther Oettinger has said he wants agreement on a new policy regime before the end of the current Commission, whose mandate expires in 2014.
An overall aim is that renewable energy should be developed in "a sustainable, market-integrated and cost effective manner".
The renewables sector has grown rapidly but investor uncertainty has been exacerbated by the lack of a target beyond 2020, a weak carbon price, and sudden withdrawals of subsidies for renewables, such as solar energy.
The renewable energy directive adopted in 2009 only requires the Commission to present a post-2020 renewable energy roadmap in 2018, the communication notes, but adds the Commission senses "a growing belief amongst stakeholders that planning for the post-2020 period requires consideration already today".
For now, the only firm incentive in place beyond 2020 is an EU Emission Trading System (ETS) cap which is set to decrease by a factor of 1.74% per year.
As Europe nears grid parity – the point at which renewables become cost-competitive – pressure for further reductions of subsidies is likely to grow.
"The Commission advocates moving as rapidly as possible towards schemes which expose producers to market prices and encourage cost reductions avoiding over compensation," the communication says.
For newer technologies, however, it predicts "certain cost-effective and well-targeted support schemes will still be necessary beyond 2020".
It also argues abrupt withdrawals of subsidies in some member states have been "disruptive".
Christian Kjaer, chief executive of the European Wind Energy Association (EWEA), said: "EU funds must be leveraged, for example through the European Investment Bank and by potentially using structural funds, towards technologies that can make a significant and immediate impact on jobs, while reducing Europe's fuel import bill.”
“Onshore wind energy offers the greatest short-term stimulus potential, followed by offshore wind energy and investments in electricity infrastructure,” he added.
Renewable energy support schemes
To try to ensure best practice, the Commission intends to publish guidelines on the creation, design, structure and reform of renewable energy support schemes in 2013.
The EU wants renewables to ensure security of supply and reduce dependence on foreign imports, as well as to cut carbon emissions.
More than half the energy consumed in the EU comes from countries outside of it, including 80% of its oil and 60% of it gas, making the EU the world's largest energy importer.
Last year, oil imports alone cost €315 billion, the Commission says. EWEA estimates that the total cost for European energy imports is closer to €700 billion.
To keep climate change below 2 degrees Celsius, the European Council of Ministers and Parliament have set the non-binding goal of reducing greenhouse gas emissions by 80-95% by 2050, compared with 1990 levels.