A few days before the Commission is due to present its report, the Centre for European Policy Studies (CEPS) presented a study on 'Market Stimulation for Renewable Electricity in the EU'. The report is the work of stakeholder Task Force, composed of industry representatives, environmental NGOs and other stakeholders, organised by CEPS and the Dutch Energy research Centre (ECN) and chaired by the International Energy Agency.
The report makes the case for continuing support for renewable electricity for a number of reasons, most notably the reduction of technology cost of RES production. At the same time, the report confirms concerns that rising volumes of power produced from RES coupled with different national support systems could result in distortions in Europe's renewable electricity markets, which raises trade barriers and impacts on competition. As a result, the authors see the need to harmonise the different EU support schemes. Policy harmonisation would, according to the experts, increase the stability of the power grid and allow for economies of scale through liquid and efficient markets.
However, the report concedes that harmonisation would be difficult to implement at present, mainly due to the fact that many member states have only recently implemented their national support policies. As a result, it proposes a time-table for harmonisation:
- by 2007: analysis of best practises of support schemes; harmonisation of the total level of support; planning if grid extension; promotion of better authorisation prodecures;
- by 2010: harmonisation of support schemes (to come into force by 2016) and of the EU framework; harmonised RE-GO schemes; harmonisation of national grid access codes;
- after 2015: phase-out of mandatory support.
The expert panel also makes several recommendations to both national authorities and the Commission on ways to further promote the development of RES:
- Targets beyond 2010 should be set in order to provide more investment security. These targets should be high enough to provide an extra stimulous to RES, but not overly ambitious, which could impact on the competitiveness of electricity-intensitve economic activities. Member states should be able to merge their targets;
- Harmonised, reliable and accurate renewable energy guarantees-of-origin (RE-GOs) systems must be implemented as soon as possible in order to remove trade barriers to cross-border RES trade.
- Network improvements will be essential to facilitate a greater uptake of renewable power in the European grid;
- Member states should use the forthcoming review of best practice to implement adjustments to their respective schemes;
- The EU's various energy and environment policy instruments should be better co-ordinated in order to come to one coherent structure. In particular, the emissions trading scheme (ETS) and the renewables directive pursue different objectives, which could hamper member states' support for RES;
- The international dimension of RES policy should be explored through the integration of non-EU countries in the EU renewables policy framework.
