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A Historical Review of Promotion Strategies for Electricity from Renewable Energy Sources in EU Countries
Abstract
The core objective of this paper is to elaborate on historically implemented promotion strategies of renewable energy sources and the associated deployment within the European electricity market. Hence, at a first glance, the historic development of renewable energy sources in the electricity (RES-E) sector is addressed on Member State and on sectoral level as well as consequently discussed according to available RES-E potentials and costs. The specific focus of this paper, are promotion strategies for RES-E options as they are the key driver of an efficient and effective RES-E deployment. Therefore, the paper depicts the main types of different promotion schemes and their properties. Additionally, several cases studies of different European Member States show an in-depth analysis of the different RES-E promotion schemes. In this context, special emphasises are put on the question of effective and efficient promotion scheme designs of different RES-E technologies. Generally, conducted research led to the conclusion, that technology specific financial support measures of RES-E performed much more effective and efficient than others did. Hence, it is not all about the common question of feed-in tariffs vs. quota systems based on tradable green certificates, but more about the design criteria of implemented RES-E support schemes.
... Other barriers identified by the American Chamber of Commerce in Belgium (AmCham Belgium) include Belgium's unfavourable geology for energy resources. According to Haas et al. (2011), it was clear from the beginning that due to Belgium's small market, liquidity would also be a barrier to the implementation of renewable energy. ...
... Figure 12 shows the development of several renewable energy sources for electricity generation from the year 1990 to 2007. The graph illustrates the strong growth rate of solid biomass from the 2000s, showing it to be the largest contributor to electricity generation during that period, with around 50% of Belgian renewable energy sources of electricity coming from solid biomass (Haas et al., 2011). The use of biowaste in electricity generation seems to remain consistent throughout the years. ...
... Alternatively, they may also pass on the cost of these certificates to the consumer (Fouquet, 2008). This started with the promotion of waste, biomass and wind energy in particular as renewable sources of electricity generation (Haas et al., 2011). Another policy introduction by Flanders was the quota obligation system, which was based on TGCs and placed the responsibility on electricity suppliers. ...
The purpose of this study is to identify political obstacles to the transition to green energy in Europe. Previous studies have not fully analyzed political barriers blocking or frustrating the implementation of renewable energy on a regional level. To identify political barriers to renewable energy on a regional level, five European regions were examined by conducting interviews and reviewing literature. The authors hope the outcome of the research will guide European regions in the development of their energy policies and better equip them with expertise on regional best practices, as well as on how to avoid repeating past errors. The research findings were presented at the conference of the European Free Alliance and the Fryske Nasjonale Partij in Leeuwarden
... An effective method, but it is still applied to a narrow field and needs more studies and developments, which is the use of green hydrogen to store energy. As it has been demonstrated in several previous studies, the hydrogen is one of the excellent fuels with high energy storage capacity [1][2][3]. ...
... The distribution of the annual hourly wind speed calculated using equation (2) based on the reference data is shown in figure (2). As indicated in this figure, the wind speed is strongly varied with time from 0 to 18.5 m/s at the El-Oued region, the average wind speed is 5.43 m/s. ...
... ) presents the hourly variation of the mechanical power calculated based on the hourly wind speed at the hub level (figure(2)) and the power curve of the Gamesa G52-850 wind turbine model (equation(1)). ...
The potential for developing wind energy for hydrogen production in El-Oued region (Algeria) is investigated in this paper. Hourly wind speed data for the year 2021 was used to estimate the monthly green hydrogen that could be extracted from a typical commercial wind turbine as well as from a wind farm. A statical approach based on the Weibull distribution has been used to estimate the annual and monthly energy productions of the studied wind-hydrogen system. This study found that hydrogen production from wind energy is encouraging in the El-Oued region. According to the obtained results, hydrogen generation is 33 % higher in the summer than in the other seasons. The results also have showed that the annual energy production (AEP) extracted from a typical wind turbine installed in El-Oued region could produce a green hydrogen amount that feeds about 36 vehicles per year, or 14.45 MWh of equivalent electrical energy.
... Several countries have therefore launched ambitious wind power development programs aimed at promoting the exploitation of this renewable energy; most of these programs focus on onshore and offshore wind power projects [5][6][7][8][9][10][11][12][13]. For instance, the '12th Five Year Plan (2011-2015)' of China achieved a 5 GW capacity increase in energy sourced from offshore wind farms and expanded to an extra 30 GW capacity as at 2020 [14]. ...
... The energy supply of most African countries still depends on few hydroelectric dams, thereby placing a strain on the limited energy system on the continent and resulting in intermittent electricity outages [34][35][36]. In developed countries, there is a comprehensive energy transition plan from thermal to renewable energy sources, however these plans do not mostly factor the African continent into consideration [7][8][9][10][11][12][13]. ...
The African continent is endowed with massive energy resources such as hydropower, solar, wind, natural gas, wave energy, and many more, yet it is the continent with the least energy supply in the world thereby resulting in a lack of sufficient energy to meet its growing energy demand. Though the continent holds 100 GW of wind capabilities, the current installed capacity as at 2018 was 5.7 GW with countries in northern Africa as well as South Africa capturing over 90% of the wind energy share on the continent. Therefore, this paper reviews the wind energy industry in Africa by identifying the current installed and potential capacity of wind energy on the continent. The challenges faced by the wind energy industry such as policy, competition, technical and economic are also reviewed. Transitions, technological innovation systems, and strategic niche management theoretical sustainability transition framework as well as proposed pathways to overcome these prevailing challenges hindering the full exploration of the wind energy sector in Africa are also highlighted in order to uplift the continent's socioeconomic status. Basically, this can be achieved through the adoption of strong 'political-will' by African national governments to drive wind energy development. There is also the need for institutional frameworks to ensure the practical adoption of new wind energy technologies. Furthermore, the major benefits Africa stands to gain from investment in wind energy are enumerated by comparing with the benefits realized by other countries' economies as a result of investing in the wind energy industry. For instance, cheap electricity, job creation, industrial growth, and eco-friendly energy source.
... For example, in the low voltage distribution network, households with rooftop solar systems have adopted battery energy storage systems (BESSs) [23] to maximise the economic benefits for the households [23][24][25][26][27][28]. In addition, the household battery energy storages, when managed coherently, can be used to enhance the stability and mitigate the adverse impacts of large integration of rooftop solar systems in the low voltage distribution network [29]. ...
... The feedback model in PIO based SoC estimation can be presented by Eqs. (28) and (29). ...
Battery energy storage systems are becoming an integral part of the modern power grid, mainly to maximise the utilisation of renewable energy sources and negate the intermittence associated with different weather condition, as well as to support grid during extreme operating conditions. Precise and real-time knowledge of battery available capacity at a given instance is of paramount importance for optimal and efficient energy management of the power grid with high penetration of renewable energy sources, as well to ensure the highest utilisation of a battery life. State of Charge (SoC) is the most commonly used measure of the battery available capacity that quantifies the percentage of battery nominal capacity that is available at a given instance. An efficient SoC estimation approach for batteries in power grid is expected to possess attributes such as high accuracy, low complexity, near real-time estimation capability, chemistry agnostic nature, etc. In the literature, an overwhelming amount of battery SoC approaches with different levels of implementation complexity and accuracy have been reported. With a view to presenting critical analysis of the existing battery SoC estimation approaches from the perspective of battery energy storage systems used in power grids, this paper presents a comprehensive review of the commonly used battery SoC estimation approaches. The presented review includes a detailed description of each of the approaches and highlights their pros and cons in power grid applications.
... El estudio empírico se centra en la industria eléctrica en los 27 miembros de la Unión Europea -UE-durante el periodo 1998 -2009. La UE como contexto se eligió porque es considerada un líder mundial en la generación de energías renovables (Haas et al., 2011). Además, la UE se considera un referente en el desarrollo de políticas públicas favorables para el fomento de las energías renovables (Reiche, 2006). ...
... Además, la UE se considera un referente en el desarrollo de políticas públicas favorables para el fomento de las energías renovables (Reiche, 2006). En particular, las principales acciones llevadas a cabo por la UE para fomentar las energías renovables se han centrado en la industria eléctrica por ser considerada clave para hacer frente al cambio climático; ya que las emisiones de CO 2 de esta industria representan más de un tercio de las emisiones de carbono globales (Haas et al., 2011). Asimismo, es un contexto adecuado para los objetivos de investigación planteados porque a pesar de pertenecer a la misma región socio-económica, los países de la UE muestran una gran variabilidad en términos de emisiones de CO 2 , producción de energías renovables, regulaciones, creación de empresas nuevas de energías renovables, y preocupación ambiental. ...
Nuestra investigación nace con el propósito de analizar la importancia y el valor añadido que las decisiones, en materia de responsabilidad social, pueden ejercer sobre los resultados de la empresa, centrándose en el rol que la gestión de recursos humanos (GRH) desempeña en esta relación
... This also applies to EU countries. For many years, the EU energy policy was based on an integrated approach to national energy security, economic competitiveness and environmental and climate protection issues [21,22]. The EU countries report an increasing role of RES in the energy production structure. ...
... One of the crucial areas of economic activity in the EU is meeting the energy needs of its inhabitants [22,58]. It is predicted that the energy demand of EU countries will rise systematically over the next 25-30 years [59]. ...
Energy constitutes an essential share of costs across any economy. The percentage of electricity in the overall energy consumption is steadily increasing. This increase, however, is not reflected correctly in the consumption basket relevant for measuring inflation and, therefore, for monetary policy formulation. We argue that the energy mix reflected in inflation should be revised in favour of electricity. We present an analysis of inflationary pressures across Europe and decompose the impact of energy categories on headline inflation. Building on the inflation expectations framework, this study examines the characteristics and magnitude of the current energy price dynamics and quantifies its share in the countries’ effective inflation. Our research also confirms a compelling insight into the country’s energy structure and inflationary pressures when a larger share of renewable electricity sources proves to be associated with lower inflation. Finally, we argue that the energy price shock cannot be viewed as a one-shot event as in the case of oil price shocks in the past. We draw recommendations for monetary policy formulation. The implication of renewable sources on inflation should be of interest to policymakers, especially in times of high, almost galloping inflation rates in some European countries, unstable fossil energy sources supply due to geopolitical instability, and climate crisis.
... Price security and lower administrative costs are critical design considerations for FIT (Dong et al., 2021;Haas et al., 2007). The key design characteristics for FITs to attract investment require contracts to provide favourable grid access conditions (Lipp, 2007), investment stability guaranteed by a long-term duration (Sawin, 2004), and low administrative and regulatory barriers (Haas et al., 2011;Keyuraphan et al., 2012). The contract duration is a key factor for profitability (Komor & Bazilian, 2005). ...
South Africa is at the precipice of an existential energy crisis. Notably, the country’s endowment comprises vast stores of biomass, wind and solar energy potential that provide the country with a comparative advantage. Transiting from coal to renewable energy sources can stimulate the green economy and mitigate the country’s power shortages. Moreover, by advocating for the decarbonization of the energy sector, a significant contributor to greenhouse gas emissions, this research underscores the potential for advancing South Africa’s decarbonization objectives. This paper explores the design of financial instruments and tax incentives to promote the upscale of renewable energy development in South Africa. A qualitative appraisal is conducted on South Africa’s incentive regime. The study contributes to the scholarship on policy design to stimulate renewable energy generation.
... Faced with the limits, high prices, pollution issues of fossil fuels, and the desire to lower carbon dioxide emissions and protect nature, the use of renewable energies such as wind power, solar, geothermal, etc., is now necessary. Wind energy is one of the most profitable of these options [1]. Wind turbines (WTs) do not affect water or land during production and do not release greenhouse gases (GHGs), despite their damaging manufacturing and dismantling processes [2]. ...
Citation: Mseddi, A.; Dhouib, B.; Zdiri, M.A.; Alaas, Z.; Naifar, O.; Guesmi, T.; Alshammari, B.M.; Alqunun, K. Exploring the Potential of Hybrid Excitation Synchronous Generators in Wind Energy: A Comprehensive Analysis and Overview. Processes 2024, 12, 1186. Abstract: Due to the unpredictable nature of the wind, uncertainty in the characteristics of wind electrical conversion systems (WECSs), and inefficient management tactics, wind turbines have historically had operational inefficiencies. In order to overcome these drawbacks, the hybrid excitation synchronous generator (HESG), an alternative to traditional generators, is presented in this study along with the suggestion to use robust regulators to regulate HESGs. This research begins with a thorough review of the literature on generators often seen in modern wind systems. Next, a simulation platform that merges a WECS with a HESG tied to an isolated load is built using the MATLAB Simulink environment. Pitch angle control investigation shows a new experimental approach to determine the link between turbine output and the reference pitch angle. Furthermore, an evaluation of the mechanical stability of the WECS is conducted by a comparison of the performance of a H∞ controller and a CRONE controller. The simulation results demonstrate the efficiency of the CRONE controller in reducing mechanical vibrations in the WECS. By reducing vibrations, the proposed control technique enhances the overall performance and efficiency of the wind turbine system. The field is extended by the demonstration of how HESGs and reliable control systems can enhance wind turbine performance while eliminating inherent limitations.
... In recent years, the gradual depletion of fossil fuels and their environmental impact, as proposed by Tao Li [1], have led to a manifold increase in research efforts towards Renewable Energy Sources (RES) like Wind Energy Systems (WES), Photovoltaic Systems (PV), etc. Among the various RES systems, as proposed by Haas [2] and Wretling [3] -WES is considered an alternative to traditional fossil-based energy generation because of its clean nature and efficiency, and is gradually replacing fossil-based power sources. WES in general, Wind Turbines (WT) are thus gaining importance in recent days as the world is recognizing their significance in attaining the Paris Agreement's goal of limiting global warming to 1.5 degrees Celsius by 2100 [4]. ...
... Because the development momentum of the new energy sector stems from environmental benefits and energy substitution rather than the profit drive of the industry itself [41], policy support is pivotal in guiding the new energy industry agglomeration process [42,43]. For instance, Reinhard et al., (2011) found via a study of several cases in EU member states that fiscal support measures were more effective in promoting the development of the new energy industry than other measures [44]. Li et al., (2021) argued that the new energy industry bears more risks and market uncertainties compared to traditional industries, thus requiring government subsidies to address market failures and drive industry development [45]. ...
The advance of the new energy industry and the promotion of green innovation are both important ways to solve environmental pollution and achieve economic green transformation, and there may be a non-negligible intrinsic connection between the two. Utilizing panel data covering the period from 2011 to 2021, encompassing 30 provinces and cities in China, this study measures agglomeration levels of the new energy sector and green innovation performance in each region. Via the application of the fixed-effect model and spatial Durbin model, this study empirically examines the impact mechanism of green innovation performance resulting from the agglomeration of the new energy industry. This investigation discloses that there is regional heterogeneity in China’s new energy industry agglomeration level, with the highest level observed in the western region. The distribution of green innovation performance forms an “East–Middle–West” ladder pattern, with both the central and western regions falling below the national average. Agglomeration of the new energy sector exerts a non-linear, “U-shaped” influence on green innovation performance, demonstrating conspicuous regional heterogeneity; opening up positively moderates the “positive U-shaped” correlation between new energy agglomeration and green innovation performance. A clear spatial spillover effect characterizes the agglomeration of the new energy industry, demonstrating a non-linear “inverted U-shaped” influence on the green innovation performance of surrounding regions. This paper aims to offer policy insights into the establishment of developmental layouts for the new energy industry in China while simultaneously providing practical references for enhancing regional green innovation performance.
... This discrepancy is primarily in the RES and fossil fuel capacities. -The forecasts for variable renewable energy capabilities match the NECP values, [13]. ...
The paper presents Romania to illustrate how more production capacities from renewable energy sources can be integrated as part of the environmental protection and geostrategic policies, in an accelerated energy transition process. Increasing electricity production, especially for the widespread development of wind turbines and rooftop solar PV systems, requires the development of the electrical grid and increased interconnection capacity. The authors of this report also take into account the behavior in different seasons, cold and warm, in terms of the amount of renewable energy injected into the network. The data used in the study is based on the interpreting and associations of various information at the national and European levels, highlighting that the benefits of renewable energy are not only seen in terms of significant reductions in environmental impact but also in terms of cheaper energy! In summary, it is assumed that in 2023-2026, the electricity demand at the level of quality indicators will be covered by investments in new generation facilities related to grid reinforcement measures.
... Several studies have shown that increasing atmospheric CO2 levels have a Investment in the RE sector is expected to revitalize the global economy after the Covid-19 pandemic because the RE sector can create more jobs. Sustainable policies and incentives in this sector are critical to renewable energy development (Bull, 2001;Haas et al., 2011;Jahangir et al., 2021;Miguel Mendonça, 2007;Safrina & Utama, 2023;Tuan et al., 2021;Wahyudi & Palupi, 2023). A typical example of an incentive policy of RE is the FIT policy. ...
The FIT policy are widely adopted in the world to promote the utilization of renewable energy technology (RET). Tariff rates, tariff regression mechanisms, contract term, and quota constraints are all components of the FIT policy. This policy has also been adopted by Association of Southeast Asian Nations or ASEAN countries to optimize their renewable energy (RE) potential. This paper examines the utilization of RET in power generation under the FIT policy from the perspective of the growth of renewable energy, environment, and investment which applied in five major ASEAN countries in term of the biggest generation capacity, such as: Indonesia Vietnam, Malaysia, Thailand, and the Philippines. This study shows that the FIT has been successful in accelerating renewable energy growth compared to pre-FIT, where annual RE capacity growth was 7.52%
... In the study of Del Rio and Burguillo (2008) on Spain, it was determined that renewable energy has significant effects on local sustainable growth. Many different support policies are implemented in the world for the effective use of energy consumption (Nicolini et al., 2017;Behrens et al., 2016;Kitzing et al., 2012;Haas et al., 2011). Some studies in the field have focused on analyzing the effects of energy grants and subsidies used in industrial policy to reduce imbalances in underdeveloped areas, stimulate employment and economic growth, and influence settlement decisions. ...
The purpose of this study is to analyze the effects of investment incentives in the electricity sector on economic growth in Turkey. The data used in the study cover 60 quarters between 2005-2019. The dependent variable of the study is the gross domestic product, and the independent variables are the employment rate, gross fixed capital formation, and incentive amount. FMOLS, DOLS and CCR long-term estimators were used for the analysis of the data. According to the results of the analysis, the effects of employment and gross fixed capital formation on economic growth are observed positively; whereas the effect of incentives on economic growth is negative. The effect of employment on growth seemed to be greater than that of incentives. Therefore, it has been suggested to the policy-makers that it would be appropriate to determine the optimum amount of incentives triggering growth to prevent the crowding out of private-sector investments.
... Unavailable in a usable form in its natural state, electricity is a so-called "secondary" form of energy, i.e., resulting from the transformation of primary points. The latter can be fossil-based (oil, gas, and coal) [3], nuclear [4,5], or renewable (from solar radiation, wind, the water cycle, biomass, etc.) [6][7][8]. ...
This survey article has explored a number of energy storage-related topics.
We start by outlining the main challenges and objectives related to energy storage.
Second, we went over a number of energy storage techniques and the standards used to choose the best available technology. We also talk about the problems and restrictions that currently exist with energy storage methods. Thirdly, we provide information on the battery technologies that are most often employed in a variety of energy storage applications. Together with their market share, social and environmental factors, and usage and kind, batteries are detailed. Also, an overview of current developments in cell balancing techniques and battery state estimation is provided.
... Because of the very high costs for the new PV technology when first entering the market in the 1990s, several strategies to promote PV have been implemented. There are comprehensive surveys on these strategies in the early years of PV deployment [30,31]. Four different categories of promotion schemes can be differentiated: (i) early schemes; (ii) feed-in-tariff (FIT): In 1998, Germany was the first country to implement a FIT scheme for PV electricity that is fed into the distribution grid, first known as "kostengerechte Vergütung" and in 2004 named "feed-in-tariff"-a groundbreaking step; (iii) in parallel other countries implemented so-called net-metering; (iv) finally since about 2012 bidding/tendering programs have become popular. ...
Electricity generation from photovoltaic (PV) plants plays a major role in the decarbonization of the energy sector. The core objective of this paper is to identify the most important conditions for the future development of PV in order to achieve its greatest possible benefits of PV systems for society. This analysis is based on the documentation of the historical deployment of quantities of PV and on the lessons learned regarding cost developments. In addition, the improvements of PVs technical and environmental performance parameters are investigated. A major result is that the impact of PV feed-in on network capacities may be substantial. Hence, classical energy-based network charges are inadequate. Changes in tariff and pricing structures are needed especially on retail level. The major conclusions is that customers should also receive time-variable price signals that tells them the real-time value of electricity in the system and provides incentives for taking electricity from the grid or feed-in. In addition, the tariffs should have components for maximum power from and to the grid. Another conclusion is that on retail level grid parity already today provides sufficient incentives to purchase a PV system in many countries without additional financial support.
... Policy Risk: Several studies highlight the importance of political stability and credibility of support as essential features to attract sufficient capital [5,14,22,23]. RE Investors are dependent on support schemes and changes in policy pose one of the most important threats to RE investors [24]. Policy risk encompasses all risks associated with unfavourable developments in RE policy issues, especially retroactive but also a general unfavourable environment. ...
Renewable electricity procurement auctions (RE auctions) have received much attention for their potential efficiency in reducing the cost of support levels associated with renewable electricity (RE). However, very little attention has been paid to their impact on financing costs. This is problematic as financing costs are central for investors when deciding whether to invest in renewable technologies, and can thus be critical for effective RE deployment. We applied a multi-level risk perspective that comprises country specific, renewable sector related and project related risks. This risk-based approach was used to identify the effect of RE auction implementation on financing costs whilst including relevant further risks. Using a 2-level cross classified multilevel model, it was demonstrated that, contrary to politician's fears, the implementation of auctions does not increase financing costs. In addition, technology type and the state of development of the finance sector in the specific country were revealed as having a very significant impact on the cost of capital. Our findings indicate that in order to promote the deployment of RE technologies, policy makers should not focus on whether or not to deploy auctions, but on general financial conditions, the type of remuneration scheme, and risk mitigation in general.
... The reasoning of such a state might replenish the complementarity of searched results. (Haas et al., 2011) cite significant differences in RES adoption across the member states, which are determined by the pathdependency, structure of economies and also geographical location. (Striekowsky et al.,2013) Speak about significant hurdles that remain to reach generally binding environmental goals in terms of the RES in the EU. ...
The natural environment and the human economy are tightly interrelated systems. The paper investigates long-term input-output relations between economics and the environment regarding draws (raw materials) from the system and loads (pollution) to the system. More recent evidence about consumption and use patterns was provided regarding raw extraction and waste production. New insights about the contribution of the EU member states toward the sustainable use and reuse of materials and waste have been highlighted. The results support the EKC hypothesis regarding the firm and negative relationship between income and GHG emissions in CO2 eq., strengthening the evidence about a further drop in emissions responding to income growth. However, the inconclusive results suggest a cyclical waste production and raw materials consumption pattern. Thus economic growth instead encourages consumption. Moreover, there is a lack of cooperation between the EU member states on a national level to fill common environmental goals. EU member states are pursuing their goals rather than individually, thereby "locking" themselves against each other. Their effort results in substantial differences, and their overall progress is vague. The cluster analysis shows relatively significant heterogeneity between the subclusters and high inter-class variance within; regarding renewable energy share, water use, waste recycling and circular material use. More inclusive coordination of policies and broader decentralization of power-decision bodies on the regional level might shape economic-environmental relations more sustainably.
... Under the conditions that there are sufficiently high penalties for non-achievement of quota obligations, utilities that must fulfil a quota have a strong incentive to do so, even if the state does not regulate how to do it. However, quotas lack incentives to develop renewables beyond the upper limit of the quota, while feed-in tariffs through price guarantees set no limits for expanding renewables (Haas et al., 2011). Beyond quotas, governments can use tendering (auctions) as a competitive purchasing mechanism. ...
Renewable energy is a key component for increasing resilience and limiting climate change, along with ecological benefits and energy independence for developed and less developed countries alike. Surprisingly, the expansion of wind and solar energy capacity varies tremendously between countries, even considering the different economic and natural conditions. While some countries have changed their energy mix to a substantial extent, others have not yet unlocked their potential for renewable energies. Our paper thus asks for diverse factors explaining varying patterns of renewable energy potential exploitation from 2010 to 2019. Besides structural conditions and general political factors, we focus on specific regulatory, market, and funding policy instruments packages. We find that while regulatory and market instruments, as well as electoral democracy and government effectiveness matter for the expansion of wind and solar electricity production, high oil rents seem to counteract it. While regulatory instruments played a crucial role in the ‘implantation phase’ at the beginning of the 2010s, its impact declined over time while market instruments' effect increased over the ‘sprouting phase’ years of 2010s. This points to an increased market-readiness of the technology following years of market penetration.
... energy efficiency has been overshadowed by the reduction of emissions (see and promotion of RES (see Haas et al., 2011). Despite previous declarations on the importance of energy efficiency, the binding 2020 EU objectives did not involve an increase in energy efficiency, in contrast to the reduction of emissions and growth of renewables. ...
This book examines a variety of laws and policies governing the European and Japanese electricity sectors. The book evaluates and compares the regulatory frameworks for achieving energy transitions in Japan and the European Union (EU) by answering a number of questions on the essence and range of the regulatory models used by leading global economies which herald carbon neutrality by 2050. The book systematises Japanese and European energy policies and legislation including electricity-related policies, plans, and programmes. To discuss these matters in relation to the European and Japanese 2050 energy transition the book delves into the four pillars of the transition: market reform, reduction of emissions, promotion of renewables, and enhancing energy efficiency. Each chapter shows the timing of the actions undertaken both in Europe and Japan; analyses the character of the conducted actions, including the players and stakeholders of the realised agenda; and presents the technologies involved in the energy transition. These correspond with the policy goals and priorities which propelled the energy transition in the EU and Japan. The author provides answers to questions concerning the regulatory tools that Japan and the EU may use in the future, and the problems which may emerge during the implementation phase. Additionally, the book presents the lessons learned on facilitating the energy transition. The book provides an in-depth review of the EU and Japan’s energy policies and laws in terms of electricity market and climate action, including energy efficiency, renewable energy sources, and the reduction of emissions.
... The results of their research demonstrate how this scenario induces structural changes along the whole energy supply chain, revealing dynamic vulnerabilities and trade-offs that are not adequately accounted for by existing indicator-based assessments. Ievgenii Shulga, Nataliia Shynkaruk, Stanislav Shytyi, Ievgen Antypov | The Role of Energy Directives in Ensuring EU Energy Security and the Problems of Implementation in Ukrainian Legislation Haas et al. (2011) attempted to elaborate historically implemented promotion strategies of renewable energy sources and the associated deployment within the European electricity market. Hence, at a first glance, the historic development of renewable energy sources in the electricity (RES-E) sector is addressed on Member State and on sectoral level as well as consequently discussed according to available RES-E potentials and costs. ...
This article attempts to analyze the role of energy directives in ensuring energy security of the European Union, as well as the analysis of the current state of their implementation in the legislation of Ukraine in accordance with the Treaty establishing the Energy Community and the Association Agreement with the EU. The development of legal security of energy sphere in the EU from the Treaty of Paris on the European Coal and Steel Community to the fourth energy package, which allowed to provide the development of competition among producers and suppliers of energy resources, to provide equal access to the energy distribution and gas-distribution networks, to liberalize the energy sector and energy resources, to increase the use of green energy, to reduce emissions into the atmosphere, and to raise the level of energy security in Ukraine. In this article, authors have used the systematic approach and legal method analysis of the implementation process of EU Energy Directives in the Ukrainian legislation, in particular the Law "On Natural Gas Market", the Law "On Electricity Market", the Law "On Energy Efficiency", the Law "On Energy Land and Legal Regime of Special Zones of Energy Facilities", and the Energy Strategy of Ukraine till 2035 "Security, Energy Efficiency, Competitiveness".
... The various incentive instruments each have advantages and disadvantages, as summarized in Table 4. It is also relevant to note that the appropriate design and implementation of incentive instruments is generally more important than their type [59,65]. ...
This study assesses key barriers to offshore wind power (OWP) development in Vietnam and policy options for the development of the sector. A survey of 39 experts from government agencies, research institutions, industry, and civil society plus 22 follow-up interviews were conducted over January-September 2021, coupled with a broader analysis of key barriers and policy options. The analysis finds that an underdeveloped policy environment , incomplete procedures, and infrastructure and supply chain immaturity are key current barriers to OWP development in Vietnam. Recommended policy measures include: 1) setting a clear vision and ambitious target for OWP development, 2) adopting a renewable portfolio standard while charting the way for a move from feed-in tariffs to reverse auctions, 3) clarifying that OWP project developers are to self-connect to onshore grids, and 4) developing a streamlined leasing and licensing process within an integrated overall electricity and marine policy. If enabled by well-designed policy, OWP has the potential to play a key role in Vietnam's emission reduction and energy availability efforts.
... In this context, quite references can be highlighted dealing with the effectiveness of RE promotion policies in different countries worldwide and time periods. In particular, Liu et al. (2019) developed a fixed effect model combining both aggregate and specific RE policies in the Other studies overview the support policies used to foster renewable electricity generation in energy transition processes, within the European electricity market (Haas et al., 2011a), in Algeria also analysing the present and future potential of RE technologies as well as the problem related to the use of RES and their promotion policies (Stambouli, 2011), in Lithuania in compliance with the European Union (EU) strategy and policy (Gaigalis et al., 2014), in several countries but focusing especially on their relevance and compatibility with the Brazilian renewable energy market (Aquila et al., 2017), across five federal countries in the Americas, i.e., Argentina, Brazil, Canada, Mexico and the United States of America, during the period 1998-2015 (Pischke et al., 2019), or based on a comparative mapping of 34 African country-specific RE policies (Müller et al., 2020). Conversely, some references can be found addressing policy dismantling processes in the RE sector, such as Gürtler et al. (2019), which is focused on the Spanish and Czech cases. ...
This paper addresses the attainment of a methodology aimed at obtaining simplified models embedding the regulatory constraints imposed by the country-specific remuneration mechanisms in the energy management system of long operating life renewable assets under a high degree of uncertainty. This methodology, composed of different steps in which sensitivity analysis as well as Monte Carlo simulation play a key role, is focused on a significant case study that has implemented two of the most widely used worldwide remuneration mechanisms in the promotion of renewable energies, i.e., feed-in tariffs and auctions. The earnings before interest, tax, depreciation and amortization have been used as the output variable of the energy management model, as it is essential to take into account both revenues and operating costs of these renewable assets to manage them optimally. Some valid simplified models have been achieved by applying the proposed methodology to the case study with generalized errors below 5%. Specifically, one simplified energy management system model has been obtained under the feed-in tariff scheme, which involves acting on almost 40% of the equations of the original model and reducing the initial input parameters by 22%. Meanwhile, two simplified energy management system models have been obtained under the auction scheme. The most conservative simplified model involves acting on almost 50% of the equations of the original model and reducing the initial input parameters by 35%, while in the less conservative case it involves acting on more than 50% of the equations of the original model and reducing the initial input parameters by 42%. In short, although the uncertainty on the energy assets cannot be completely eliminated, it can be considerably reduced by facilitating the assessment of its prospective financial results. The validity of the achieved simplified models demonstrates the suitability and usefulness of the proposed simplifying methodology, providing a touch of quality in the long-term judgement and decision-making of the stakeholders when optimally managing renewable energy facilities under any type of remuneration scheme.
... Another reason is that Vietnam still lacks the technical and management resources for the management of complex renewable energy policies. The benefits of FIT in reducing the burden, not only for investors but also for managers (Haas et al., 2011), making it suitable for continued application in Vietnam. ...
The purpose of the research is to examine the offshore wind power potential in the mix-electric power of Vietnam. By using net present value method, the paper also aims to explore how economic factors influence the offshore wind power feasibility in the conditions that the technical factors are ensured. The result indicates that offshore wind power will have a low proportion in the mix-electric power of Vietnam before 2030 and may be accelerated in the period 2035 – 2040. Electricity supply from offshore wind is not economically viable without improvements in investment, operating costs, and capacity factor. In particular, the Feed-in-Tariff (FIT) policy designed to support the development of renewable energy sources by providing a guaranteed, above-market price for producers, will be a decisive factor in developing offshore wind power of Vietnam. Additionally, the differences between characteristics of site's condition leading to the disparities in capital and operational expenditure and capacity factor. Thus, the electricity price and the subsidies for bottom-fixed sites and floating sites should be disparate and the location of offshore wind farms should be considered to ensure the harmonization of the profits derived from different types of offshore wind farms.
In the face of escalating global energy demand, the shift towards renewable energy sources has emerged as a sustainable solution. However, the integration of renewable energy into the electrical grid introduces challenges such as intermittent and instability. The concept of energy-storage-based hybrid systems, which combines renewable energy systems with energy storage, presents a promising approach to overcome these hurdles. These hybrid systems enhance grid stability by ensuring a consistent energy supply, compensating for the variable output of renewable energy sources, and providing ancillary services to the grid. Furthermore, they pave the way for a more resilient and reliable energy infrastructure, fostering the seamless integration of a substantial share of renewable energies. This paper offers a comprehensive exploration of energy-storage-based hybrid systems, discussing their structure, functioning, and the pivotal role they play in bolstering grid stability and promoting the unobstructed integration of renewable energy sources.
The chapter addresses the critical challenge of transitioning to clean energy, notably in developing countries. It emphasizes the need for resources, technologies, and effective policies for this transition. A key focus is on technical advancements aiding Africa's shift to renewable energy sources like solar, wind, hydro, and geothermal. The chapter examines technological solutions such as energy storage, smart grids, and blockchain for the energy transition. It assesses the role of Public-Private Partnerships (PPPs) in advancing sustainable energy technology in Africa. PPPs contribute to research, development, and implementation of these technologies. The chapter reviews policy and regulatory frameworks for adopting renewable energy technologies. It discusses the potential and challenges of these frameworks in Africa.
In recent years, sustainability initiatives and the prominence of renewables have emerged as pivotal priorities in addressing environmental, ecological, and socioeconomic challenges. Within this context, green certificates—representing proof of electricity generation from renewable sources—have gained substantial recognition, enabling organizations to demonstrate their commitment to clean energy. This study employs a bibliometric analysis to chart the evolution and current state of green certificates research. Drawing from the Scopus database, we sourced bibliographic data, resulting in a refined dataset of 940 documents spanning from 2000 to 2022. Through performance analysis, we systematically evaluated the landscape of green certificates research, assessing publication trends, identifying influential works, spotlighting prolific authors, highlighting leading academic institutions, mapping regional research hotspots, and pinpointing the top publishing journals in the domain. Employing science mapping techniques—such as co-authorship networks, keyword co-occurrence analysis, and bibliographic coupling—we delineated the collaborative patterns and the conceptual and intellectual structure of the field. This was further augmented by content analysis, revealing four salient research themes, emphasizing the consistent and central focus on support mechanisms and policies for renewable energy sources, sustainable renewable technologies and market dynamics, technological innovations and green certificate trading, and renewable energy sources investment strategies. Building on these findings, the paper concludes by outlining practical implications and prospective research avenues. These encompass a detailed understanding of renewable energy support mechanisms, the pivotal role of electricity disclosure in enhancing transparency, and the transformative potential of emergent technologies, such as artificial intelligence and blockchain, in the green certificate trading landscape. The research also emphasizes the fundamental role of guarantees of origin in advancing sustainability goals, the dynamic discourse on green hydrogen certification standards, and the intricate dynamics of trading mechanisms in shaping investment strategies.
Offshore wind energy is getting more attention from governments. Germany had the third rank among all countries in total offshore wind energy capacity at the end of 2022. Denmark, having less land area but a good location for offshore wind power, had the fourth rank. Both countries' offshore wind energy sectors have significant roles globally. This paper aims to explore the development paths of offshore wind energy policy in Denmark and Germany and understand the developmental differences. The trends in offshore wind energy production and the evolving policies of the governments are analysed, by comparing the two countries. Most of the policies in Denmark and Germany resulted positively, and their policy paths were sim- ilar with some nuance. The research concludes that a governmental policy strategy and a flex- ible support mechanism are the keys to developing an innovative offshore wind energy sector.
Following the technological advancements and declining generation costs, renewable energy technologies have become technically and economically viable. Both globally and within the EU zone, the great amount of investment and capacity increase in renewable energy projects made them the most powerful solutions for energy transition. The International Energy Agency estimated the share of renewables in total electricity generation globally will be over 60% in 2030 and nearly 90% in 2050 (IEA, 2021). To enable this expansion, governments need to define proper policy targets, design effective policy frameworks, incorporate policy goals and objectives into legislation, design adequate financial incentives, and strive for social acceptance of the renewable energies. These are the key challenges for many countries.
Bu çalışmanın amacı, Türkiye’de elektrik enerjisi üretim sektöründe uygulanan yatırım teşviklerinin ekonomik büyümeye etkilerini analiz etmektir. Çalışmada kullanılan veriler 2005-2019 yılları arasındaki 60 çeyrek dönemi kapsamaktadır. Çalışmanın bağımlı değişkeni gayrisafi yurtiçi hâsıla, bağımsız değişkenleri ise istihdam oranı, gayrisafi sabit sermaye Oluşumu ve verilen teşvik miktarıdır. Verilerin analizinde zaman serileri analizi yöntemlerinden FMOLS, DOLS ve CCR uzun dönem tahmincileri kullanılmıştır. Analiz bulguları çerçevesinde; istihdam ve gayrisafi sabit sermaye oluşumunun büyüme üzerindeki etkisi pozitif yönde gözlenirken; teşviklerin ekonomik büyüme üzerindeki etkisinin ise negatif yönde olduğu tespit edilmiştir. Bunula birlikte istihdamın büyüme üzerindeki etkisi, teşviklere göre daha büyüktür. Bu noktada karar vericilere, özel sektör yatırımlarının dışlanmasını önlemek amacıyla, büyümeyi uyaran teşviklerin optimum değerinin tespit edilmesinin uygun olacağı tavsiye edilmiştir.
Renewable energy investments are of vital importance for the effectiveness of energy policies of countries. The carbon emission problem will be eliminated with the help of these projects. Additionally, renewable energy investments help countries to achieve energy independence. Financing is one of the most important problems of renewable energy projects. The main reason for this is the high-cost and long-term nature of renewable energy projects. Due to these negative aspects, financial institutions such as banks and leasing companies are reluctant to lend to renewable energy projects. This situation also creates a disadvantage for renewable energy projects. Currently, the initial costs of renewable energy projects are very high compared to fossil fuels. This situation creates a cost disadvantage for clean energy projects. Therefore, some actions need to be taken to solve the high-cost problem of these projects. The EU still has an energy infrastructure that is dependent on fossil fuels. Political and military tension and other reasons especially between Ukraine and Russia affect global energy prices, and Europe’s energy supply security is under intense threat. Thus, the EU is faced with increasing energy costs. Rising energy costs make the EU economy more fragile. Therefore, sustainable and zero-carbon energy policies are vital for the EU. Therefore, they must take urgent measures to solve the energy dependency problem of European countries. In this context, renewable energy projects need to be increased. To achieve this goal, it is necessary to develop digital financial products. The initial cost of renewable energy projects is quite high. This situation hinders the increase of the mentioned investments. Digitalized financial products, on the other hand, enable investors to access more funds in a shorter time. This will help increase renewable energy projects. Thus, it will be much easier to solve the energy dependency problem of European countries.KeywordsDigitalizationFinancial productsRenewable energy projectsEnergy investments
This article is written within the European Project “THREE-Lanka” which has the aim of modernizing the higher education related to Renewable Energy (RE) in Sri Lanka. The paper presents the outcomes of analysing various incentive schemes to stimulate RE development. In Europe, there was substantial growth in RE installation through generous incentives in the first years. Then, to regulate this growth, in recent years, the auction system has been introduced to improve the competition among companies that install RE plants. In Sri Lanka, on the other hand, the main energy tariff policies focus on the spread of PhotoVoltaics (PV) through contributions based on the electricity fed into the grid. This paper provides an updated view of the evolution of the energy tariff policies in the relevant European countries with respect to Sri Lanka, covering some recent policy developments. Within the Sri Lankan framework, four case studies involving residential, commercial, and industrial users are outlined to suggest better mechanisms (in the case of not adequate current incentive tariff) for supporting the deployment of grid-connected PV systems in a wide power range. Such knowledge transfer in the THREE-Lanka project will demonstrate the enormous potential RE capacity in a developing country, still depending on fossil fuels but willing to follow the path towards sustainability.
Fluid injection into geological formations for energy resource development frequently induces (micro)seismicity. If intensely shaking the ground, induced earthquakes may cause injuries and/or economic loss, with the consequence of jeopardizing the operation and future development of these geoenergy projects. To achieve an improved understanding of the causes of induced seismicity, develop forecasting tools, and manage the associated risks, a careful examination of seismic data from reported cases of induced seismicity and the parameters controlling them is necessary. However, these data are hardly gathered together and are time-consuming to collate as they come from different disciplines and sources. Here, we present a publicly available, multi-physical database of injection-induced seismicity (Kivi et al., 2022a; https://doi.org/10.20350/digitalCSIC/14813), sourced from an extensive review of published documents. Currently, it contains 158 datasets of induced seismicity driven by various subsurface energy-related applications worldwide. Each dataset covers a wide range of variables, delineating general site information, host rock properties, in situ geologic and tectonic conditions, fault characteristics, conducted field operations, and recorded seismic activities. We publish the database in flat-file formats (i.e., .xls and .csv tables) to facilitate its dissemination and utilization by geoscientists while keeping it directly readable by computer codes for convenient data manipulation. The multi-disciplinary content of this database adds unique value to databases focusing only on seismicity data. In particular, the collected data aims at facilitating the understanding of the spatiotemporal occurrence of induced earthquakes, the diagnosing of potential triggering mechanisms, and the developing of scaling relations of maximum possible earthquake magnitudes and operational parameters. Conclusively, the database will boost research in seismic hazard forecasting and mitigation, paving the way for increasing contributions of geoenergy resources to meeting net-zero carbon emissions.
Support mechanisms for renewable energy power plants have failed many times in different geographies according to different market parameters. The system being implemented in Turkey has its own problems. The problems of the support mechanism in the study are defined in different planes and a new model proposal based on efficiency and capacity criteria and based on hourly reconciliation are made. In the scenario studies using the generation and cost data between 2012 and 2017, the solution sets that reduce the total cost and increase the earnings of the power plants participating in the support are defined.
This study evaluates investment in a utility-scale solar power plant using a real-options approach (ROA). Although ROAs have been widely applied in the literature, the deferring option for a utility-scale power plant has not been fully examined, especially within the context of the unique subsidy program of solar renewable energy certificates (SRECs) in the USA. Using data from one of the most developed solar electricity markets in New Jersey, we incorporate the time-varying volatility of electricity prices and bounded SREC prices in real-options valuation. Our results show that deferring real options generates significant value for the project that the traditional discount cash flow approach ignores. It is thus optimal to postpone the investment in >70% of cases. In addition, we demonstrate that debt financing is crucial for renewable energy investments.
Energy transitions towards green energy are taking place worldwide, motivated by climate change concerns. As the most used renewable technologies (i.e., wind, solar and hydro) have an unpredictable output, managing this variability is challenging. This paper uses a system dynamics approach to understand what type of regulation is required to successfully manage the simultaneous increase in demand and reduction in water resources in the Swiss electricity system, which is gradually replacing nuclear by solar generation. We address climate variability by running three climate scenarios while considering both demand side management and capacity auctions. Our findings indicate that, without government intervention, shortages occur and prices are higher. Subsidizing PV eliminates blackouts, decreases the electricity price and indirectly encourages Pumped Hydro-Storage investments.
In renewable dominated power systems, the primary challenge is how to incentivize the utilization of subsistent renewable energy instead of how to incentivize the investment to expand renewable energy. This paper proposes an incentive policy named incremental green certificate (IGC) to cope with the challenge. The proposed IGC directly transfers voluntary consumers’ payment to cover the premium of flexible resources to utilize more renewable energy. To make the IGC cooperative with power markets, a two-stage day-ahead market clearing model is proposed. In the model, the first stage follows on-going power market rules to clear the locational price, and the second stage reschedules the flexible resources to clear the IGC. Also, the incentive compatibility of the proposed policy is demonstrated, and the system dynamic model is built to quantify the long-term influence. Conclusions are drawn from the case studies on modified PJM 5-bus and a real-life provincial power system in China. The IGC would boost the investment of flexible resources, reduce the curtailment of renewable energy, and benefit renewable energy companies in the long term.
The global context suggests need to move towards decarbonization as part of international climate change commitments promoting clean energy and social welfare actions. The hydrogen market is a global trend because it responds to energy needs and to be feasible requires effective regulatory and policy frameworks. Mexico has a presence in the hydrogen market, but it is still limited and presents challenges in energy governance. The objective of this study was to analyze the importance of the legality and legitimacy of the current conditions of the hydrogen market in Mexico. A systematic search of the literature was conducted through scientific platforms and various federal laws and policies associated with the hydrogen market were reviewed. The main findings suggest that Mexican regulations present commercial, ecological, human, economic, and technological challenges, that may run counter to international agreements and challenge energy governance by discouraging the hydrogen market and curbing expected decarbonization.
In 2020 the European Commission approved the GND (Green New Deal), a strategic plan aimed at the decarbonization of the EU by 2050. In this scenario, the diffusion of alternative renewable energy sources (RESs) play a key role, particularly electric energy production from wind and photovoltaic power plants. Regardless, the nonprogrammable nature of these power sources led recent studies to focus the interest on the power-to-gas solution (PtG), consisting of the electrolytic transformation of excesses of unused electric energy into hydrogen. The complexity of this technology requires the development of strategic optimization models aimed at finding the best locations for new PtG plants in specific territorial scenarios. This paper presents the development of a GIS-based optimization model that combines an operational research approach with territorial services based on geographic information system (GIS) data. The study is located in Sicily (Italy), considering the large renewable energy penetration in the larger Mediterranean island. The developed model allows us to find the best location for new PtG installations in the considered area by combining GIS automated processing with cost function resolution. The results of this work could be useful in the years to come in light of the rapid spread of hydrogen energy production in Italy.
This chapter focuses on public incentives and legislative measures to improve energy efficiencyenergy efficiency. The Chapter addresses the approaches to improve energy use by industry and individuals, starting with energy conservationenergy conservation and rationalisation as a way to alleviate energy shortages in the 1970s and moving on to discuss current attitudes to optimising energy production and consumption. In this context, the Chapter assesses the pro-efficiency initiatives, targeted programmes, certificationcertification schemes, and energy efficiency targets in the EU and Japan, all of them governed by specific legislation. By analysing the changes that have been made in Europe and JapanJapan under the previous and current regulatory framework on energy efficiencyenergy efficiency, the Chapter discusses regulatory toolsregulatory tools offered under the framework of the three European directives relevant to energy efficiency. It also offers an insight info JouleJoule programme, ThermieThermie programme, and SAVESpecific Actions for Vigorous Energy Efficiency (SAVE) programmes, and analyses Japanese actions under the Moonlight ProjectMoonlight Project and the 1979 Act on Rationalisation of Energy UseAct on Rationalisation of Energy Use (1979), along with recent laws and policies on energy efficiency in the EU and JapanJapan. A separate space is offered to combined heat and power (CHP), technology recognised in the European and Japanese climate and energy policies as an element of energy transitionenergy transition.
In recent years, uptake of grid integrated household rooftop solar battery systems (RSBSs) has increased significantly. This paper presents a thorough analysis on technical and economic performances of the common types of batteries featuring in RSBSs using test data of different commercial batteries. In this study, number of complete cycles, battery voltage deviation during a discharge period, discharge capacity, energy output and round trip efficiency are considered as the technical performance indicators of a RSBS battery. While evaluating the economic performance, the expected household net incomes from the RSBSs of different battery types have been calculated considering the uncertainties in household electricity demand and solar power generation using Monte-Carlo Simulation. Moreover, the payback period of RSBSs of different battery types have been predicted in this study. The outcomes of this study provide a clear insight to the performance of commonly used batteries in the RSBS, which will aid the end users in making educated decisions while choosing RSBSs.
The core objective of this work is to demonstrate equitable decarbonization of heat supply in residential multi-apartment rental buildings. A modeling framework is developed determining a socially balanced financial governance support strategy between the property owner and tenants to trigger a heating system change. The results of different decarbonization scenarios of a partly renovated old building switching from gas-fired heat supply to either the district heating network or being equipped with a heat pump system show that an equitable heating system change is possible, but with massive public subsidy payments. Particularly, the investment grant to the property owner and additional rent-related revenues due to building renovation are decisive for the profitability of the investment. Simultaneously, subsidy payments to the tenants are required at the beginning of the investment period to limit their energy and rent-related spendings. Results also show that the heat pump alternative is not competitive compared with district heating, even in case of extensive retrofitting of the building. Allocating the costs of inaction (opportunity costs associated with rising CO2 prices) between the governance, property owner, and tenants turns out as an important lever, as required subsidy payments can be reduced significantly.
The fact that market experience improves performance and reduces prices is well known and widely exploited in technology-intensive industries, but sparsely used in analysis for energy technology policy. Knowledge of the experience effect can help in the design of efficient programmes for deploying of environment-friendly technologies. The effect must be taken into account when estimating the future costs of achieving targets, including targets for carbon dioxide reduction.
This book discusses issues raised by the experience effect, such as price-cost cycles, competition for learning opportunities in the market, risk of “technology lockout” and the effects of research, development and deployment policies on technology learning.
Case studies illustrate how experience curves can be used to set policy targets and to design policy measures that will encourage both investment in and use of environment-friendly energy technologies. Low-cost paths to stabilising CO2 emissions are explored.
Compiled within the cluster "Green electricity" cofinanced under the 5th framework programme of the European Commission
The promotion of electricity generated from Renewable Energy Sources (RES) has recently gained high priority in the energy policy strategies of many countries in response to concerns about global climate change, energy security and other reasons. This chapter compares and contrasts the experience of a number of countries in Europe, states in the US as well as Japan in promoting RES, identifying what appear to be the most successful policy measures. Clearly, a wide range of policy instruments have been tried and are in place in different parts of the world to promote renewable energy technologies. The design and performance of these schemes varies from place to place, requiring further research to determine their effectiveness in delivering the desired results. The main conclusions that can be drawn from the present analysis are: (1) Generally speaking, promotional schemes that are properly designed within a stable framework and offer long-term investment continuity produce better results. Credibility and continuity reduce risks thus leading to lower profit requirements by investors. (2) Despite their significant growth in absolute terms in a number of key markets, the near-term prognosis for renewables is one of modest success if measured in terms of the percentage of the total energy provided by renewables on a world-wide basis. This is a significant challenge, suggesting that renewables have to grow at an even faster pace if we expect them to contribute on a significant scale to the world's energy mix.
In recent years, a wide range of strategies has been implemented in different EU-countries to increase the share of electricity generation from renewable energy sources. This paper evaluates the success of different regulatory strategies. The most important conclusions of this analysis are: (i) regardless of which strategy is chosen, it is of over-riding importance that there should be a clear focus on the exclusive promotion of newly installed plants; (ii) a well-designed (dynamic) feed-in tariff system ensures the fastest deployment of power plants using Renewable Energy Sources (RES) at the low-est cost to society; (iii) promotion strategies with low policy risks have lower profit re-quirements for investors and, hence, cause lower costs to society.
This paper summarises the major recommendations and conclusions of the third Forum of the European Network on Energy Research (ENER) which took place in June 2002 in Budapest. The major perceptions of this meeting as well as the most important conclusions and recommendations for energy policy makers are compiled in this summary. The statements compiled in the following represent a consensus within the ENER Network while on some questions differences in perception and analysis persisted.
This book was written in the frame of the OPTRES project, which was supported by the European Commission within the framework of the Intelligent Energy for Europe programme. The consortium, consisting of six European partners, analysed the effectiveness as well as the economic efficiency of currently implemented support schemes for renew-able energies in the electricity sector (RES-E) in the enlarged European Union. The analysis gives recommendations for future improvements of the existing RES-E promotion measures. Furthermore the consortium carried out an extensive stakeholder consultation, focussing on the identification of existing market barriers to the development of renewable electricity in the EU. The effectiveness and efficiency of current and future RES-E support schemes were analysed with particular focus on a single European market for renewable electricity products. Current best practices were identified and an assessment made of the (future) costs of RES-E and the relevant support necessary to initiate stable growth. The main barriers to a higher RES-E deployment as perceived by market actors and stakeholders were assessed.
The paper provides details on green certificate systems in Belgium. The Flemish region has established a system and the Walloon region is preparing a slightly different one. The lack of uniformity and consequently of transparency in one country emphasises the need for more EU leadership in the field. The main part of the article analyses the established Flemish system. Green certificates are complementary to other instruments that promote renewable electricity, e.g. direct subventions on the feed-in price of green electricity or direct subventions on capital investments. Certificates execute a forcing effect on the actual development of green power if the imposed shares of green power in total sales are significant and if the fine level is at the height to enforce the quota. If the fine is too low the incentive effect turns into a financing tax effect. When the green certificate system does the job it is designed for, i.e. operating at the edge of the RES-E development and organise the transition from a non-sustainable to a sustainable power system, certificate prices will be high and reduce end-use consumption of electricity. A segmentation of the RES-E sector along the various RES-E technologies is a necessity to keep any certificate system affordable, effective and efficient. One can segment the tradable certificate market or one can assign a different number of certificates to a different RES-E technology project. Both solutions require an intensive follow-up of cost structures and of other policy measures (subventions), but given the infant state of understanding and experience segmenting markets may be best in the nearby years.
Quota obligation schemes based on tradable green certificates have become a popular policy instrument to expand power generation from renewable energy sources (RES). Their application, however, can neither be justified as a first-best response to a market failure, nor, in a second-best sense, as an instrument mitigating distortionary effects of the emissions externality, if an emissions trading system exists that fully covers the energy industry. We study how ancillary reasons, in form of overcoming various barriers for RES use and establishing beneficial side-effects, such as industry development, energy security, and abatement of pollutants not covered under the ETS, apply to the scheme recently introduced in Poland. While setting substantial expansion incentives, an advantage for local industry or job-market development or energy security can hardly be seen. With rising power prices for end consumers and awareness that the extra rents from the schemes mostly accrue to foreign investors and renewable and polluting generators, we expect a negative impact on social acceptance for RES and RES deployment support policies.
Energy policy has recently become an important point on the political agenda of the EU, mainly due to the approaching ‘peak oil’ and climate change. This is increasing the focus on renewable energy sources, especially wind power, as an alternative to fossil fuels. In order to deduce the most efficient policies for promoting wind power, this paper compares the different national energy policies adopted by Denmark, Sweden and Spain, and relates them to wind energy outcomes. The successful promotion of Danish wind power in the last two decades of the 20th century is related to a number of factors including individual entrepreneurs, early official certification of wind turbines, systematic government support including favourable economic tariff schemes, and cooperative private ownership of wind turbines, which fostered broad public support. The analysis demonstrates the importance of long-range national energy policies in creating and stabilizing the conditions required for the development of more sustainable energy systems. The lack or delayed development of such a supportive, stable environment explains the different patterns of wind development seen in Sweden and Spain, and points to the problems created by liberalized and short-sighted commercial energy market, even for wind energy pioneers like Denmark. Copyright © 2007 John Wiley & Sons, Ltd and ERP Environment.
With several mid-term policies in place to support the development of renewables, the European Union (EU) seems on its way to increasing the share of renewable energy to the targeted 12% by the year 2010. It is however, yet unclear how effective these policies are, which technologies will see the largest growth and which countries will indeed be able to meet their targets. This article discusses a monitoring protocol that was developed to monitor this effectiveness and judge whether targets will be met. In a step-wise approach policy instruments are characterised and analysed, leading to a quantitative assessment of the likely growth in renewable energy production for each individual technology and country in case no policy changes occur. Applying this monitoring protocol at the EU-level we show that with the current policies in place renewable energy production will reach a share of 8–10% in 2010, and the share of electricity production will reach a level of 15–18% of total electricity consumption, whereas the target is 22.5%. Additional policies are clearly needed to achieve the ambitious targets set.
Concern over climate change impacts and the projected depletion of fossil fuels has urged more governments to adopt policies that stimulate the diffusion of renewable energy technologies (RET). With an increasingly diverse suite of support instruments, the question emerges as to which instruments or combinations are able to achieve faster, more substantial diffusion results. Although various support instruments were extensively addressed in policy studies, there is still no consensus. This is partly because many policy studies take a policy-maker approach in comparing support instruments, leaving relationships between policy design and policy results as a black box. This paper proposes an investor-oriented perspective to analyze the diffusion potential of support systems for RET. The main argument is that it is not the type of support instrument but rather its risk/profitability characteristics that influence investor behavior and the rate of diffusion. The two instruments most frequently discussed and compared are the feed-in-tariff and the quota model. The analysis in this paper concludes that policy design is crucial: while often feed-in tariffs are applauded and quota system feared, feed-in tariffs may also bring about disappointing diffusion results when poorly designed while quota systems may be also conceived as attractive instruments for independent power producers.
This paper analyses the performance of ‘market-based’ and ‘feed-in tariff’ systems of renewable energy procurement, and comments on the impact of different procurement systems on investment in renewable energy. The ‘market-based’ British Renewables Obligation (RO) is not more cost-effective compared to the German feed in tariff. Although the nominal rates of payment per kWh of renewable energy are higher in Germany, this is more than offset by lower wind speeds in Germany producing a lower return on investment compared to the UK. A harmonised, EU-wide market-based system, would not improve cost-effectiveness, and may serve to reduce, rather than increase, local investment in renewable energy. On the other hand, nationally based green electricity certificate systems like the RO are not intrinsically biased against locally owned or co-operative ventures. Systems are needed which encourage a diversity of investment in renewable energy from local as well as institutional sources.
The paper describes possibilities and problems for penetration of supply systems based on renewable energy sources in liberalised markets. The analysis is based on recent development in EU with different models for support of installations based on renewable energy. These include feed-in models with guaranteed minimum tariffs, tender models for different bands of technologies, and green certificates trading models with obligatory consumer quota. The paper describes the market situation in selected European countries, including Germany, the UK, Holland and Denmark.An EU directive from September 2001 has postponed the decision on a possible harmonisation of promotional models until at least 2005 in order to obtain more practical experience with the different support schemes. A critical evaluation is given in this paper of the different models with proposals for a balanced development between environmental and trading concerns. It is argued that too much emphasis is presently given to the side of free trade at the expense of long range planning for a sustainable energy development.
A comparison of support schemes for market-based deployment of renewable energy in the UK and Germany shows that the feed-in tariff reduces costs to consumers and results in larger deployment. A survey among project developers suggests two explanations: (1) Site selection presents the biggest obstacle under the feed-in tariff. Uncertain financing of other schemes reduces efforts at initial project stages and planning permits become a major obstacle. (2) Project developers do not compete in price but for good sites under the feed-in tariff. Most importantly, turbine producers and construction services contribute to most of the costs, and face at least equal levels of competition under the feed-in tariff.
The UK's renewable energy policy has been characterised by opportunism, cost-limiting caps and continuous adjustments resulting from a lack of clarity of goals. Renewable electricity has had a specific delivery mechanism in place since 1990. The Non-Fossil Fuel Obligation (NFFO) did not deliver deployment; did not create mentors; did not promote diversity; was focussed on electricity and was generally beneficial only to large companies. A new support mechanism, the Renewable Obligation, began in April 2002. This may result in more deployment than the NFFO, but is also beneficial to electricity-generating technologies and large, established companies only. The UK Government published a visionary energy policy in early 2003 placing the UK on a path to cutting carbon dioxide emissions by 60% in 2050. This paper argues that unless the Government ‘learns’ from it's past results, mistakes and difficulties, clarifies the reasons for supporting renewable energy and then follows through with a focussed policy aimed at delivery, diversity and the creation of mentors, it is likely to be no more successful than the previous 13 years of renewable policy.
The European Union is particularly rich in variations of different delivery mechanisms for increasing the use of renewable energy. The requirements of liberalisation in continental Europe, the re-regulation of the UK's gas and electricity sectors in 2000 and ongoing environmental commitments has meant the establishment of a new generation of mechanisms following on from early prototypes. This paper analyses two new mechanisms in detail: the England and Wales RO (Renewables Obligation) and the German EEG (Erneuerbare Energien Gesetz), with a particular focus on how they reduce risk for generators. Assuming that risk reduction is an important way to make a support mechanism effective in promoting deployment, the analysis will look at three different kinds of risk, namely, price, volume and balancing risk. It is argued that the German EEG is more effective at increasing the share of renewables than the England and Wales RO because it reduces risk for RES generators more effectively.
The paper addresses both historical and current UK policy relating to renewable energy. It discusses the stated aims of policy, and discusses to what extent policy has addressed these aims, and the level of success enjoyed with respect to each goal. The paper also addresses the context in which UK policy has developed, and the effects this has had on both the creation and employment of that policy. Finally, it comments on the likely future direction of policy in the UK.
Quota obligation schemes based on tradable green certificates have become a popular policy instrument to expand power generation from renewable energy sources (RES). Their application, however, can neither be justified as a first-best response to a market failure, nor, in a second-best sense, as an instrument mitigating distortionary effects of the emissions externality, if an emissions trading system exists that fully covers the energy industry. We study how ancillary reasons, in form of overcoming various barriers for RES use and establishing beneficial side-effects, such as industry development, energy security, and abatement of pollutants not covered under the ETS, apply to the scheme recently introduced in Poland. While setting substantial expansion incentives, an advantage for local industry or job-market development or energy security can hardly be seen. With rising power prices for end consumers and awareness that the extra rents from the schemes mostly accrue to foreign investors and renewable and polluting generators, we expect a negative impact on social acceptance for RES and RES deployment support policies.
Promotion Strategies for Electricity from Renewable Energy Sources in EU Countries, Review-report of the project ELGREEN
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