Currently under discussion in the Commission, the directive is intended to create a new framework of rules for renewable energy support in the context of the liberalisation of the EU electricity market. It seeks to boost the prospects for sectors such as wind and solar, for example by setting new national minimum shares of electricity production (ENDS Daily 10 December 1998). To the chagrin of renewables operators, it also seeks to open the sector to the winds of competition.
European governments have taken radically different approaches to renewable energy support. The most successful by far in terms of encouraging building of renewable energy capacity have been schemes such in Germany, Spain and Denmark, under which grid operators are obliged to purchase renewably produced electricity at a fixed price. It is these schemes - such as the German "feed-in" rules - that the Commission wants to discourage.
The directive risks destroying some of Europe's most successful renewables industries, EWEA retorts in a position paper sent to the Commission yesterday. "With the present diversity of systems...different support systems can coexist without creating any noticeable distortion of competition, and they must be allowed to do so." "It would be extremely hazardous to disallow" schemes such as Germany's "without reliable evidence that other support schemes would work as well."
EWEA accepted that competitive bidding for quotas, as in the UK, had achieved low prices, but argued that it had tended to concentrate developments in high wind speed areas at some distance from consumers. This had caused planning problems and restricted the overall development of the sector. "For bidding systems to be effective they should be combined with a planning system which requires local authorities to allocate zones for wind farm developments," EWEA said.
EWEA said that the EU's energy sector was already distorted to the disadvantage of renewables, through subsidies for coal and nuclear. It proposed the appointment of a renewables regulator in each member state to ensure that planning, grid connections and market mechanisms are properly implemented. It said there should also be regular pricing reviews.
The comments reflect a compromise hammered out after lengthy debate, particularly with the German wind energy industry, which has stoutly defended Germany's feed-in system against more competition-based approaches (ENDS Daily 20 November 1998).
"We want a directive on renewables, and we think it is better to fix a broken car than throw it out and build a new one," EWEA chief executive Christophe Bourillon told ENDS Daily.
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