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08/12/2016

European companies criticise EU’s lack of vision on renewables

Energy

European companies criticise EU’s lack of vision on renewables

Ikea is among the companies calling for binding renewable energy targets at national level.

[Toshihiro Oimatsu/Flickr]

As the European Commission publishes its long-awaited “Winter Package” of energy laws, European companies are speaking out on the need for binding national targets for renewable energies. EurActiv France reports.

Ten of Europe’s biggest companies have criticised the weakness of the EU’s renewable energy plan, as the Commission today (30 November) publishes 1,000 pages of new energy laws.

In a report compiled by the Prince of Wales’s Corporate Leaders Group, voices from sectors as varied as furniture, telecoms, chemicals and DIY called for better coordination of efforts to promote renewables in Europe.

2030 targets

The business leaders regretted that the EU-wide 27% objective for renewable energy by 2030 was not shared out in detail between the member states, contrary to the existing 2020 objectives.

“A European objective has no effect. The regional differences between countries are a nightmare,” said Alejandro Castro Perez, the head of solar energy at IKEA, the Swedish home furniture retailer, which is campaigning for binding national objectives.

According to leaked documents seen by EurActiv, the European Commission plans to develop a programme that places the consumer at the heart of the EU’s energy policy, enabling them to produce and sell renewable energy themselves.

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But the project is undermined by the low level of the overall target and the fact that it is not binding at national level, the report said. For the countries most advanced in the energy transition, the absence of any effort sharing system is highly disappointing.

“The non-binding nature of the EU target is a real frustration: the renewables objectives are not used by the EU to make member states cooperate,” said the director of sustainable development for Kingfisher, a home improvement retailer.

“We wanted to do a synopsis of the experience of European companies. The strong message that comes through is that we have to be more ambitious. Anything else is not an asset” from a business perspective, said Jill Duggan, the leader of the corporate group in the Prince of Wales Foundation.

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Investment gap

For Giles Dickson, the president of WindEurope, the wind energy lobby, investment is the key issue.

Just seven of the EU’s 28 member states have fixed objectives for renewables post-2020, which doesn’t help building new generation capacity, he said.

“New wind energy installations declined by 9% in the first half of 2016,” he remarked.

This view is shared by Marco Mensink, the director-general of the European Chemical Industry Council (CEFIC), who believes that the renewables industry needs a longer-term vision and to stop thinking in periods of five to 20 years.

Energy industry insiders are also worried about the lack of coherence in the EU’s energy policies. Koen Noyens, from the trade association Eurelectric, believes the massive expansion of renewable energies in an inefficient system has led to investment distortions, which could have been avoided if subsidies for renewables had been better coordinated.

The many benefits of renewables

Most of the business leaders that contributed to the study are fervent defenders of renewables, for various reasons. Rob Williams, the procurement manager for British Telecom, stressed the importance of being seen to be ‘green’ or socially responsible.

“Some funds are withdrawing from investments like coal,” he pointed out, making the case for for a renewable energy investment push from policymakers.

At Kingfisher, the transition to renewables has helped protect the company from the volatility of electricity prices, as well as increasing the company’s visibility, which is always a persuasive argument for a finance director.

“There is sometimes still this perception in Europe that strong climate action will negatively impact on economic growth. But businesses show that the reality is the opposite: staying with fossil fuels is the bigger threat,” said Duggan.