Deal secured on ambitious EU renewables law

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EU governments and the European Parliament have agreed a far-reaching new directive to boost EU renewable energy use to 20% by 2020, following a compromise struck with Italy over a controversial ‘review clause’.

According to the new legislation, agreed between the Union’s lawmakers today (9 December), each EU country will be required to significantly increase the contribution of renewable energies to its energy mix, leading to an overall EU share of 20% by 2020. A 10% share of biofuels in transport by 2020, part of the overall 20% renewables target, was agreed previously under the condition that indirect land-use considerations and other sustainability criteria are taken into account (see EURACTIV 05/12/08).

Italy, with some support from Austria, had called during the last stages of the discussions for a general review clause in 2014. This could have led to the revision of the 20% EU target or of the individual national targets based on existing progress made and the likely success of subsequent efforts. 

But Rome’s proposal was afforded a cool reception from the Parliament and a number of EU member states on the grounds that the possibility of downgraded targets could undermine investor confidence and throw the entire project into disarray. Italy ultimately backed down after a compromise was struck whereby the Commission will publish a progress review in 2014 that excludes the possibility of changing national or EU targets. 

The breakthrough on the review clause and the broader deal on the renewables proposal was signalled by the French EU Presidency yesterday (8 December) following a meeting of EU energy ministers in Brussels. 

Turmes triumphant

The measures that will be mandated as part of the agreement are largely in line with the policy framework set out by Luxembourg Green MEP Claude Turmes, Parliament’s rapporteur on the file. 

Turmes, who received MEPs’ backing for his report in September (EURACTIV 12/09/08), has been credited with pushing occasionally reluctant member states towards an agreement on the new directive.

Among the most important concessions Turmes was forced to make to secure the deal was the rejection of a regime whereby member states would have faced financial penalties for failing to reach interim targets towards the 2020 goal. 

As part of a wider compromise, member states must, by 2010, draw up and submit to the Commission for review detailed national action plans (NAPs) based on an ‘indicative trajectory’, followed by progress reports submitted every two years. Brussels reserves the power to enact infringement proceedings if states do not take ‘appropriate measures’ towards their targets, meaning the decision to take legal action will be based on the Commission’s discretion rather than on strict criteria. 

Producers of renewable electricity are also set to receive preferential access to EU grids under the new directive, which contains further provisions to cut the red tape blocking renewable energy uptake in many EU countries.

Flexibility

Member states will be permitted to link their national support schemes with those of other EU states, and will be allowed under certain conditions to import ‘physical’ renewable energy from third-country sources such as large solar farms in North Africa. ‘Virtual’ imports, based on renewable energy investments in third countries, cannot be counted towards national targets, however.

A system of open trading in renewable energy certificates between EU member states, favoured by EU electricity market traders and large electric utilities, was rejected in favour of a system whereby a member state can sell or trade excess renewables credits to another member state based on statistical values. 

These so-called ‘statistical transfers’, which can only be conducted under the condition that the selling member state has reached its interim renewables targets, can also be applied in cases where member states cooperate on joint projects, according to the deal, which will receive the public endorsement of EU heads of state during the upcoming 11-12 December EU summit in Brussels.

Positions

Green MEP Claude Turmes called the deal a "source of encouragement at the beginning of the week in which EU leaders will meet to decide on whether the EU keeps its leadership and credibility on climate policies". But the MEP admitted he had "mixed feelings" about the inclusion of biofuels in the transport sector.

The agreement was received very positively both by industries in the sector and by environmental groups.

The European Wind Energy Association (EWEA) hailed the agreement as confirmation that Europe is "the leader of the energy revolution the world needs". 

Bioethanol producers meanhwile are confident "that only those biofuels that comply with unprecedentedly strict environmental and social sustainability standards can be used," according to Ramón de Miguel, president of the European Bioethanol Fuel Association (eBio). "Those arguing that this is bad legislation are not serious and disqualify themselves," he said. 

Greenpeace lamented that the EU was "insisting on the large-scale promotion of biofuels," but gave it "eight out of ten" for securing the renewables deal.

Background

On 23 January 2008, the European Commission proposed a new directive that mandates a 20% share of renewable energies in the EU's energy mix by 2020. 

Setting individual member-state targets (see EURACTIV LinksDossier), calculated on the basis of each country's per capita gross domestic product (GDP), initially irked some capitals, which questioned the Commission's number crunching.

But reservations were overcome during negotiations over the directive, in part through the use of 'flexibility mechanisms' like cross-border renewables projects, whereby a Dutch offshore wind energy farm could be partially financed by Luxembourg and Belgium, for example, in exchange for credits towards those countries' individual targets.

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