Global Economics

EU's Green Energy Plans Take Shape


Target: 20% of the bloc's energy consumption by 2020. How much each country should contribute is the focus of intense lobbying

New EU legislation aimed at having green energy account for 20 percent of the union's overall energy consumption by 2020 is taking concrete shape, with draft proposals indicating that each EU state should contribute at least 5.75 percent to an overall target. Rich member states will carry a heavier burden, however.

EU energy commissioner Andris Piebalgs is expected to unveil the legislative piece on 12 January, with some governments scheduled to lobby for the best possible deal even as early as the beginning of next month.

The directive lays out in detail how exactly to get from the current 8.5 percent to a 20 percent share of renewables in EU energy consumption by the end of next decade - something that 27 EU leaders agreed to do at their summit in March.

According to the proposal, seen by EUobserver, member states will be asked to gradually reach the final EU-wide target.

Using 2005 as a baseline, the proposal says that member states should achieve over half (51 percent) of their remaining target by 2014, they should be at two-thirds (66 percent) of their remaining target by 2016 and at 83 percent by 2018, so that they reach the target in 2020 as planned.

One commission official told EUobserver that EU capitals will not be required to contribute to the same extent, however.

The executive body is set to take into account two criteria - a member state's geographical potential to produce energy from sources such as wind, solar, geothermal or hydropower as well as its economic power based on GDP per capita.

"We are not going to ask poor countries to achieve the same as the rich ones", an official said, referring to a Brussels' plan to introduce one "fixed" and one "individual" target.

Under the plans, all member states would be obliged to cover 5.75 percent of energy consumption from green sources and in addition, they would face their own individual targets, which would mirror their geographic and economic potential.

According to one EU diplomat, exact numbers are still being finalized, as some governments are still lobbying for the most favourable figure.

In September, Mr Piebalgs told EUobserver that all EU states were "cautious to announce their potential" and that the methodology to be applied had proved "quite a politically sensitive issue".

Publication of the proposal covering three areas - electricity, transport and heating and cooling - has already been postponed twice.

In transport, all EU governments will have to ensure that their share of renewable energy sources, namely biofuels, reaches at least 6.5 percent by 2012 and 10 percent by 2020.

Cross-border trading of renewables?

In order to meet the ambitious targets, the European Commission paper suggests setting up so-called guarantees of origin -- a certificate allowing producers to trade their renewable energy within the 27-nation bloc.

"Member states shall ensure that a guarantee of origin is issued in response to a request from the producers of electricity and heat", the draft paper says, adding that "guarantees of origin shall be accurate, reliable and fraud-resistant".

In practice, this could hypothetically mean that a Greek solar farm could produce electricity for Slovakia, if the country does not have enough potential to meet its individual target or if it finds it too costly to produce such energy in its own territory.

According to a commission official, such a scenario would "motivate companies to engage in the renewable energy sector and motivate member states to use the most cost-effective way" of meeting their targets.

Under certain circumstances, Brussels will be even able to order such purchasing.

"If a member state does not meet its targets for the share of energy from renewable energy sources in 2014, 2016 or 2018, the commission may decide that such a member state must allow transfer from another member state of guarantees of origin issued to new entrants in other member states", the draft proposal says.

The same member state must also "give the right to new entrants in other member states to benefit from its renewable support schemes in the same way as domestic producers of renewable energy".

According to German newspaper Frankfurter Allgemeine Zeitung, Germany has already criticised the plan, fearing that local producers could rather export their certificates for higher prices than feed their energy into the national grid at fixed prices.

Provided by EUobserver—For the latest EU related news

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