The final agreement on the Renewable Directive

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• The final agreement on the Renewable Directive

A. first Strategic Energy Review the 20/20/20
targets B. 2nd Strategic Energy Review An EU
Energy Security and Solidarity Action Plan
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A. Climate change effects (3)
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a. World energy demand (3)

Source World energy outlook 2008
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a. World oil reserves (2)

Source World energy outlook 2008
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A. Population growth overall (1)
Year World Population (thousands) Medium variant
1980 4 451 470
1985 4 855 264
1990 5 294 879
1995 5 719 045
2000 6 124 123
2005 6 514 751
2010 6 906 558
2015 7 295 135
2020 7 667 090
2025 8 010 509
2030 8 317 707
2035 8 597 050
2040 8 823 546
2045 9 025 982
2050 9 191 287

Source Population Division of the Department of
Economic and Social Affairs of the United Nations
Secretariat, World Population Prospects The 2006
Revision and World Urbanization Prospects The
2005 Revision, http//esa.un.org/unpp,
Monday, November 24, 2008).
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Source World energy outlook 2008
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a. World oil reserves (3)

1960-1969 9, 37 1970-1979 1, 98 1980-1989
0, 98 1990-1999 0, 62 2000-2009 0, 49
Ratio discovery/production
Source World energy outlook 2008
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b. Oil reserves per capita (1)
it is assumed in this graph that the 2007 world
oil reserves are estimated at 1.3 trillion
barrels, the oil demand in 2008 is around 31724
million barrels, it increases by 1.3 per year
and the world population increases from 6.6
billion in 2007 to 8.8 billion in 2040.
Source World energy outlook 2008, World Energy
outlook 2007,Population Division of the
Department of Economic and Social Affairs of the
United Nations Secretariat, World Population
Prospects
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F. Car ownership (1)

Source Vehicle Ownership and Income Growth,
Worldwide 1960-2030, Joyce Dargay, Dermot Gately
and Martin Summer, January 2007
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F. Car ownership (3)
Years USA cars/1000pers China Cars/1000 pers India Cars/1000 pers OECD Europe Cars/1000 pers
1960 411 0.38 1 80
2002 812 16 17 498
2030 849 269 110 725

Years USA total vehicles (millions) China total vehicles (millions) India total vehicles (millions) OECD Europe total vehicles (millions)
1960 74.4 0.2 0.4 29.18
2002 233.9 20.5 17.4 243,4
2030 314 390 156 358,9
Source Vehicle Ownership and Income Growth,
Worldwide 1960-2030, Joyce Dargay, Dermot Gately
and Martin Summer, January 2007
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IntroductionWhat is in the package?

• Overall Communication
• Revision of EU Emissions Trading System (the ETS)
• Effort sharing in non ETS sectors
• Directive on promotion of renewable energy,
  report on renewable energy support schemes
• Directive on carbon capture and storage, and
  Communication on demonstration plants
• Revised environmental state aid guidelines
• Accompanying integrated impact assessment

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A shared effort between sectors
GHG Target -20 compared to 1990
-14 compared to 2005
EU ETS -21 compared to 2005
Non ETS sectors -10 compared to 2005
27 Member State targets, stretching from -20 to
20
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The European Path towards 2020 in climate and
renewable

• 20 GHG reduction compared to 1990
• Independent commitment
• 30 GHG reduction compared to 1990
• In context of international agreement
• 20 renewables share of final energy consumption
• 10 Renewable energy in transport, with
• production being sustainable
• second generation biofuels commercially available

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A shared effort - Cost efficient achievements of
the GHG and Renewables targets

• Allocating targets between sectors and Member
  States on the basis of pure cost efficiency
  causes high compliance

costs compared to GDP for poorer Member States

• Package approach is to increase fairness but
  foresees policy instruments to achieve cost
  efficiency

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A shared effortApproach EU package

• Cost-effectiveness Fair distribution
• Solution
• Fairness differentiate efforts according to
  GDP/capita
• national targets in sectors outside EU ETS
• national renewables targets (partially half)
• redistribution of auctioning rights (partially
  10)
• Cost-effectiveness introduce flexibility and use
  market based-instruments (EU ETS, transferability
  of Guarantee of Origin for renewables, access to
  JI/CDM)

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A Fair shared effort

• The package requires all Member States and
  sectors to take action to reduce GHG and increase
  renewables

• The package create a competitive level playing
  field
• The package distributes costs more fairly
  between Member States

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• Renewable energy

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Why Renewables?

• Security of Supply
• Sustainability
• Climate Change abatement
• Shift towards a new energy mix
• Decentralised Energy supply
• Regional and green industry development
• Encouragement of households and industry to save
  energy and to take care of own supply in
  sustainable way

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The renewables Directive

1. Sets mandatory national targets for renewable
   energy shares, including 10 biofuels share in
   transport, in 2020
2. Requires National Action Plans,
3. Gives flexibility for Member States to reach part
   of their target through
4. Statistical transfer
5. Joint projects between Member States and third
   countries with existing or planned interconnector
   capacity (under certain conditions and provided
   RES energy reaches the EU) )
6. Encourages joint Support mechanisms between MS
7. Sets clear rules for disclosure quality of
   Guarantees of origin
8. Requires reduction of administrative and
   regulatory barriers, improvements in provision of
   information and training and improves renewables
   access to the electricity grid
9. Creates a sustainability regime for biofuels

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EU packageEffort Member States Renewables
BE BG CZ DK DE EE IE EL ES FR IT CY LV LT LU HU MT
NL AT PL PT RO SI SK FI SE UK
1.4
RES share in 2005
7.5
1.5
Flat rateincrease of 5.5
Additional effort weighted by GDP per capita
Figures adjusted byearly starter bonus
0
0.7
4.7
EU-27
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National action plans

• Sectoral targets now set by Member States
• Measures adequate to achieve the targets
  including planned development of biomass
  resources
• Provides policy stability for investment

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Administrative reforms

• Reforms, or requires reforms of administrative
  and regulatory barriers to the growth of
  renewable energy
• simplification and streamlined procedures
• planning authorities to consider renewable energy
  and district heating and cooling systems
• minimum levels of renewable energy in building
  codes for new or refurbished buildings
• promotion of energy efficient renewable energy
• Certification regimes for installers mutual
  recognition

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Grid access

• Improves renewables access to the electricity
  grid
• Repeats existing access conditions given in
  2001/77/EC
• Requires Member States
• to provide priority access to the grid system for
  electricity from RES
• to develop grid infrastructure
• to review cost sharing rules

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Biofuels

• Sustainability criteria for biofuels
• GHG savings minimum of 35
• No raw material from sensitive areas (old forest,
  grasslands, protected areas)
• No conversion of wetlands and continuously
  forested areas
• EU biofuels must meet cross compliance
  environmental rules
• Consequences of not meeting the criteria
• Dont count towards targets no public
  support/tax breaks
• Member States to give a bonus in their biofuel
  obligations to biofuels from wastes, residues,
  cellulosic and lignocellulosic material

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• Impacts
• from the package

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What are the benefits
of the package?

• The ultimate goal avoid the cost of climate
  change impacts 5-20 of global GDP (Stern)
• Large scale innovation in the energy sector
• First mover advantage, aiming for technological
  leadership in low carbon technology
• Significant energy efficiency improvements
• Energy security reduction of oil and gas import
  of 50 billion per year (at 61 per barrel
  of oil)
• Reduced air pollution giving significant health
  benefits
• Reduced need for air pollution control measures
  11 billion per year in 2020
• Worldwide energy gap in 2020 calls for min. 5TW
  of Renewables (IPCC)

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Renewables Role as Climate supporter will be
strengthened
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The future a combination of big and small or
just small vs just big? Source Future Energy
Systems in Europe commissioned by EP STOA and
carried out by ETAG 2008

• Reaching a final agreement on the Renewable
  Directive

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Overview on National Support schemes

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Harmonisation and coordination of National
Support Mechanisms

Can be a good instrument to help smooth
transition and target reaching To be studied
and elaborated jointly between States Task is
challenging example Spain and Germany In Spain,
solar-thermal power plants play an especially
important role as a result of that country's
abundance of sunshine. Energy from the sea is
also of special importance and receives special
rates. Germany, on the other hand, has
differentiated more strongly in the areas of
offshore wind, structurally integrated
photovoltaic systems and various biomass
applications (Source Feed In Co-operation)
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Renewable Energy Investment Potential in times
of Economic Crises
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Current Global Crisis

Ive never seen financial insiders this spooked
This time, market players seem truly horrified
because theyve suddenly realized that they
dont understand the complex financial system
they created. The bottom line is that policy
makers left the financial industry free to
innovate and what it did was to innovate
itself, and the rest of us, into a big, nasty
mess. (Paul Krugman in 2007) The new Renewable
Directive may indeed become one of the best tools
for Member States to recover economically and
socially and to shift towards sustainability in
energy and away from dependency
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Sustainable Energy Policy - at the heart of the
healing process

The RE plus Efficiency sector could be at the
forefront of economic dynamism for recovery in
all Member States The effort consumers or state
aid programmes pay to receive the benefit of RES
looks like a quantité négligeable in view of the
current bail outs paid from public money to banks
and industry worldwide. In November 08
financial rescue initiatives in the US alone
reached 8.5 trillion ( Bloomberg News) RE
industry guarantees qualified jobs, regional
development, real income, shift to sustainable
energy supply and consumption, energy
independence Currently about 2.3 million people
worldwide work either directly in renewables or
indirectly in supplier industries (Worldwatch
Institute)
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UN EP (WorldWatch) Green Jobs Report 2008- the
key drivers of green employment

Global market volume for environmental products
and services currently about 1,370 billion
(1,000 billion), projected 2,740 billion
(2,200 billion) by 2020. Forward-thinking
government policies needed. Important for
providing funding of green projects overall
goal- and standard-setting beyond the time
horizons typical in the business world providing
infrastructure that private enterprises cannot or
will not create and creating and maintaining a
level playing field for all actors. Key policies
include Phase out subsidies for environmentally
harmful industries, shift those funds to
renewable energy, efficiency technologies, clean
production methods, and public transport. Fix the
current shortcomings inherent in carbon trading
and Kyoto Protocol related innovations like the
Clean Development Mechanism Tax Reform. Scale
up eco-taxes, such as those adopted by a number
of European countries, and replicate them as
widely as possible. Eco-tax revenues can be used
to lighten the tax burden falling on labour while
discouraging polluting and carbon-intensive
economic activities.
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Effects from the package

• EU showing leadership in climate change
• EU on a path towards a low-carbon economy
• Cost-efficiency and fairness at the heart of the
  package
• A significant effort, but future benefits far
  outweigh the costs
• Will deliver important economic, energy security
  and environmental co-benefits, also in the short
  term

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• http//ec.europa.eu/environment/climat/climate_act
  ion.htm
• http//ec.europa.eu/environment/climat/future_acti
  on.htm