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Renewable energy: A more ambitious target is needed for 2030

EU Reporter Correspondent



table-rock-dam-405x304The EU renewable industry is calling on EU policymakers to show more ambition for renewables in the future EU climate and energy policy and in the action plan to tackle the energy crisis. More than 140 participants joined the conference "rescuing Europe from energy dependency: the role of renewables" organized by the EU renewable energy industry on Monday 22 September, which gathered representatives from EU institutions, as well as energy experts from the IEA and the renewable energy sector.

A month ahead of the European Council, which is expected to adopt an official position on the Commission’s proposal for future EU climate and energy policies, AEBIOM, EGEC, ESHA, ESTELA, ESTIF and EUREC have sent a clear message to the EU institutions: the Commission’s 2030 vision does not reflect the potential of diverse renewable energy options, be it renewable heating and cooling or dispatchable renewable electricity. They welcomed European Commission President-elect Jean-Claude Juncker’s ambition to create "a Europe’s Energy Union to become the world number one in renewable energies".

The security of energy supply crisis faced by the EU today makes the need to strengthen the development of renewable energy sources urgent. Combined with energy efficiency measures, they represent the only sustainable way to increase EU energy independency, tackle climate change, and strengthen our economy. This requires, among other things, an ambitious EU renewable energy target distributed in national legally binding targets among member states.

"In their forthcoming decision in October, it is essential that Member States consider Renewables as a no regret option for the future EU energy mix, including alleviating our energy dependency," said EGEC President Burkhard Sanner. "The Commission’s 2030 proposal of a 40% reduction target for GHG emissions and a 27% target for renewable energy is merely the equivalent of ‘business-as-usual’. The RES objective needs to be revised upwards," he added. "For the EU binding renewable target to have an effect, binding national targets must be defined. We doubt that national voluntary objectives would deliver," added AEBIOM Secretary General Jean-Marc Jossart.

"The design of the future energy system needs to focus on the consumer, making them a part of the solution", said Pedro Dias, Secretary-General of ESTIF. "In this particular context, renewable heating technologies can provide more stable and affordable options to households and industry, while promoting local investments and jobs creation" he added. The Commission’s proposal also does not recognize sufficiently the potential of dispatchable renewable energy sources in the electricity sector. "While all renewable energy technologies have an important and complementary role to ensure a transition towards a sustainable energy system, concentrated solar thermal and geothermal energy, as well as biomass and hydropower can facilitate the integration of variable sources" said Marcel Bial, Secretary General of ESTELA. The European renewable industry urges EU Policy makers to take note of the outcomes of this conference as significant inputs for their future decisions.

AEBIOM is the European Association representing the bioenergy sector in Europe. The main aim of AEBIOM is to develop the market for sustainable bioenergy such as bioheat, electricity from biomass and biofuels (including biogas).

EUREC is the leading association of research centres and university departments active in the area of renewable energy. The purpose of the association is to promote and support the development of innovative technologies and human resources to enable a prompt transition to a sustainable energy system.

ESTIF is the European Solar Thermal Industry Federation representing the whole value chain of solar thermal from research and testing to manufacturers and service providers

ESHA (The European Small Hydropower Association) represents the interest of the hydropower sector by promoting the benefits and opportunities of hydropower at EU level.

ESTELA is the European Solar Thermal Electricity Association representing the industry of solar thermal electricity (concentrated solar power) from manufacturing firms to research institutes in Europe and MENA region.

EGEC The European Geothermal Energy Council is the voice of the geothermal sector in Europe, representing members from 28 European countries including private companies, national associations, consultants, research centres, geological surveys, and public authorities.


Germany bets US will make the best of 'bad deal' Nord Stream gas link





Germany is betting the US administration will take a pragmatic approach to the Nord Stream 2 project to ship Russian gas to Europe and is pushing for the pipeline’s completion in defiance of US opposition, officials and diplomats said, write Andreas Rinke, Robin Emmott and Timothy Gardner.

To try to block the $11 billion project, led by Russia’s Gazprom, successive US administrations have imposed sanctions on some entities and warned other companies involved in the project about the sanctions risk.

President Joe Biden thinks the pipeline under the Baltic Sea to Germany is “a bad idea for Europe,” the White House has said.

Nord Stream 2 will bypass Western ally Ukraine, potentially depriving it of valuable transit fees. It will also increase European energy dependency on Russia and compete with shipments of US liquefied natural gas.

Berlin is calculating the best strategy is to present the United States with a done deal in the form of a finished project, diplomats and officials said.

The pipeline is already around 95% built, and could be finished by September, analysts who monitor tracking data say, leaving the Biden administration little time to come up with more measures to thwart it.

“Berlin is trying to buy time and make sure that the construction is finished, because they think that once the pipeline is onstream, things will look differently (to the United States),” a senior EU diplomat briefed on the issue said.

Like other officials who spoke to Reuters, the diplomat declined to be named because of the sensitivity of the issue.

Although Washington has publicly said it will keep working against Nord Stream 2, German officials and EU diplomats believe there is room for negotiation.

“Berlin believes there’s a willingness in Washington to talk about this and find a solution,” a second EU diplomat also briefed on German thinking said.

Berlin has yet to begin substantive discussions with the Biden administration on Nord Stream 2, and does not definitively know the US position.

Washington continues to engage the German government at multiple levels to make the sanctions risk clear, a senior US State Department official said.

While Biden opposes the project, however, he is also attempting to repair relations with Europe.

“We don’t see this as something where the US has to come to the table with options. This is a German problem that the Germans actually created,” the official said.

Germany has no plans to make proposals either.

“We are not presenting a list of offers – nor has the US government demanded anything,” a senior German government official said.

German Foreign Minister Heiko Maas is waiting for his first face-to-face meeting with US Secretary of State Antony Blinken, possibly at the end of this month if Blinken attends a meeting of NATO foreign ministers in Brussels, German diplomats said.

Maas has defended Nord Stream 2 as a private, not a political enterprise and the companies involved have repeatedly said the justification for the link is commercial.

Germany also says the pipeline will give Europe greater security from gas supply disruptions, and that it has protected Kyiv by ensuring Russia continues to export some of its gas via Ukraine.

But the United States, and some European countries, say the project is part of a Kremlin plan to manipulate European countries and undermine neighbours, such as Ukraine, that seek to withdraw from Moscow’s orbit.

Some Biden administration officials, while repeating their opposition to Nord Stream 2, say Washington needs to be pragmatic about what it can realistically do after two previous US administrations failed to stop the pipeline.

“The context here is important too, I mean, it’s a difficult inheritance,” said one of two State Department officials that spoke to Reuters.

Some senior US officials, recognising that the pipeline is nearly complete, have urged the Biden administration to consider easing pressure on Germany and focus instead on how to leverage Nord Stream 2 in the event of future crises.

“If we can’t stop the pipeline, then how can we make the best of it once it is done,” one of the senior US officials said.

Last month, a former German ambassador to the United States floated the idea of a compromise between Washington and Berlin that would have given the completed pipeline a use as political leverage.

Under the plan, Germany’s energy grid regulator could be empowered to stop gas flowing if Russia crossed a line.

Triggers for what the former envoy, Wolfgang Ischinger, called an “emergency brake” might include a flare-up in violence between Ukraine and Russia, which annexed Ukraine’s Crimea peninsula in 2014, or if Moscow sought to undermine Kyiv’s existing gas transit infrastructure.

Designed to ease US concerns, the proposal garnered interest among senior European officials and diplomats outside Germany, and in parts of the German government.

But it did not gain traction with the German government as a whole, because of practical problems implementing it, and because Berlin did not feel a pressing need to offer a compromise to Washington.

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One tenth of Turkey’s planned coal projects wiped out

EU Reporter Correspondent



Three coal power plant projects accounting for ten percent of Turkey’s planned coal pipeline have been scrapped. The cancellation of the Cayirhan B (800 MW), Agan (1580 MW) and Ayas (625 MW) coal projects contrasts starkly with a tender for 1 GW of solar auctioned earlier this week. It received over 250 bids worth a potential 4 GW of solar capacity, demonstrating that interest and momentum is behind renewable energy while coal’s prospects decline.

Most notable was the license cancellation of Cayirhan B by the Electricity Market Regulatory Authority (EMRA). It was the first project to be privatised under a new law aimed at offering developers off-the-shelf sites, a strategy that places responsibility for securing permits and vital checks and balances, such as environmental impact assessments, land expropriation, and building permissions in the hands of state-owned company EÜAŞ, before offering them up to tender at private auctions [1]. The second site offered under the same scheme, Alpu, in Eskişehir, has seen the procurement procedure repeatedly cancelled after no companies entered any of the seven tenders held for the site.

“Turkey’s coal pipeline has been halved between 2016 and the end of 2020. The cancellation of a further 10 percent of projects shows that its coal industry is declining just as rapidly as the rest of Europe's,” said Duygu Kutluay, Campaigner at Europe Beyond Coal. “Since 2016, the Turkish government has actively sought to make it as easy as possible for coal companies to simply move in and start operating, presenting coal projects as lucrative, no strings attached investments. But it’s increasingly obvious that investors think the smart money is in Turkey’s rich renewables potential rather than coal. The government should heed this message, and start diverting the support schemes it readily offers for coal to the clean energy transition instead.”

The Hunutlu coal power plant in Adana is now the only coal plant under construction in Turkey. A recent report by WWF Turkey and SEFIA [2] shows that the 1.7 billion dollar, Chinese-backed plant will need to operate for at least 26 years to repay its initial investment, with the situation likely to get worse as market conditions increasingly favour wind and solar over coal.

  1. EÜAŞ: A briefing for investors, insurers and banks
  2. An auction for Solar Renewable Energy Resource area (YEKA GES 3) attracted 276 project bids from 85 firms amounting to nearly 4 GW capacity. 

    Europe Beyond Coal is an alliance of civil society groups working to catalyse the closures of coal mines and power plants, prevent the building of any new coal projects and hasten the just transition to clean, renewable energy and energy efficiency. Our groups are devoting their time, energy and resources to this independent campaign to make Europe coal free by 2030 or sooner.

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Commission approves support scheme for energy-intensive companies in Spain

EU Reporter Correspondent



The European Commission has approved, under EU state aid rules, a Spanish scheme to partially compensate energy-intensive companies for the costs incurred to finance support to (i) renewable energy production in Spain, (ii) high-efficiency cogeneration in Spain, and (iii) power generation in Spanish non-peninsular territories. The scheme, which will apply until 31 December 2022 and will have a provisional annual budget of €91.88 million,  will benefit companies active in Spain in sectors that are particularly energy-intensive (hence with high electricity consumption relative to the value added of production) and more exposed to international trade.

The beneficiaries will obtain compensation for up to a maximum of 85% of their contribution to the financing of support to renewable energy production, high-efficiency cogeneration and power generation in Spain's non-peninsular territories. The Commission assessed the measure under EU state aid rules, in particular, the Guidelines on State Aid for environmental protection and energy 2014-2020, which have been extended until the end of 2021. The Guidelines authorise reductions – up to a certain level – in contributions levied on energy-intensive companies active in certain sectors and exposed to international trade, in order to ensure their global competitiveness.

The Commission found that the compensation will only be granted to energy intensive companies exposed to international trade, in line with the requirements of the Guidelines. The measure will promote the EU energy and climate goals and ensure the global competitiveness of energy-intensive users and industries, without unduly distorting competition. On this basis, the Commission concluded that the measure is in line with EU state aid rules. In connection to this scheme, the Spanish authorities have also notified to the Commission a measure granting guarantees in relation to long-term power purchase agreements concluded by energy-intensive companies for electricity from renewable energy sources, the so-called Reserve Fund to Guarantee Large Electricity Consumers (FERGEI).

This guarantee scheme aims to facilitate the production of energy from renewable sources. The Commission assessed the measure under EU state aid rules, in particular, the 2008 Commission Notice on state aid in the form of guarantees, and concluded that the state guarantee scheme does not constitute aid within the meaning of Article 107(1) TFEU. More information will be available on the Commission's competition website, in the State Aid Register.

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