ABB - Abengoa Solar - Alpha consultants - Gugushev & Partners - H1 Venture Swiss Holding AG - Hareon Solar - IBC SOLAR - ILB Helios Group - iPLON - Jinga & Asociatii - Juwi solar - M&W Zander - PFG Law Firm - ROMELECTRO - STRABAG
Binding energy efficiency and renewable energy targets for 2030 are a guarantee for ambitious greenhouse gas reduction and low energy costs
Two recent studies by the Fraunhofer Institute for Systems and Innovation Research ISI and Vienna University of Technology show that a climate target on its own would fail to trigger enough additional energy savings and a continuous evolution of renewable energies. The EU would thus neglect an important opportunity to curb energy wastage and excessive spending on energy imports. Binding EU energy efficiency and renewable energy targets for 2030 should therefore accompany a possible European 2030 climate target. This is necessary to ensure ambitious greenhouse gas reduction while at the same time taking into account cost effectiveness and European competitiveness.
"To achieve the EU’s long-term 2050 climate ambitions, a diverse portfolio of energy efficiency and renewables technologies will be needed. We have to develop these technologies now if we want them to be available when we need them" says Dr. Wolfgang Eichhammer, Head of the Competence Center Energy Policy and Energy Markets at the Fraunhofer ISI.
Without binding 2030 renewables and energy efficiency targets, these technologies would only rely on the European carbon emissions trading system (ETS) to provide investment incentives, offering a unique and lower remuneration for all technologies with higher risks.
Steeper risk premiums for investments in energy efficiency and renewable energy would lead to unnecessarily high specific generation costs for those installations that do get built. In addition, immature, currently still high-cost options would not be deployed, therefore neglecting technology learning and cost reductions in technologies which will be necessary in later decades.
Modelling results from the TU Vienna consortium indicate that if the ETS were the only instrument applied, this would result in a renewables share of only about 26 percent in 2030, compared to 31.2 percent in the other analyzed scenarios. However, renewables drive down wholesale electricity prices through the so-called merit order effect on the electricity and CO2markets. A lower renewables share would save on support costs for renewables, but would also see higher wholesale electricity and CO2 prices, thus resulting in roughly the same financial burden to electricity consumers.
"We can have more renewables at the same cost but for doing so a clear commitment is needed, and a binding 2030 renewables target is a forward-looking first step in this direction" says Dr. Gustav Resch from the Energy Economics Group at TU Vienna.
Additionally, Fraunhofer ISI has calculated a 41 percent cost-effective end-use energy savings potential for 2030. This result is based on a detailed bottom-up assessment of the energy savings potential in individual sectors by Fraunhofer ISI: industry (21 percent), residential (61 percent), tertiary (38 percent) and transport (41 percent). Realizing this potential would result in €240bn net savings per year in 2030 on energy bills for householders and industry in Europe. Thus, a reasonable 2030 target for energy efficiency appears highly beneficial and would help the consumers further to lower their energy costs.
"With a suitable mix of three targets for climate protection, renewable and energy efficiency, and respective policy measures, the right balance between competition and risk can be better maintained” says Dr. Mario Ragwitz from the Fraunhofer ISI. This would trigger mass deployment of low-cost options (e.g. through the ETS) while at the same time encouraging the smooth development of less mature technologies, with positive effects on the European innovation capability and competitiveness.
The European Union and its Member States are presently debating a possible new target system for 2030 which shall follow up the 2020 triple target system comprising 20% reduction in greenhouse gas emissions and energy consumption, as well as a 20% renewables share. The European Commission is expected to publish a proposal early 2014.
The study "Analysis of a European Reference Target System for 2030” of the Fraunhofer ISI can be downloaded at www.isi.fraunhofer.de/isi-en/x/projekte/2030-target-system.php
The results of the project “beyond2020 – Design and impact of a harmonised policy for renewable electricity in Europe” coordinated by the TU Vienna and supported by the EU in the frame of the “Intelligent Energy Europe” programme can be downloaded at www.res-policy-beyond2020.eu
Source:
Fraunhofer Institute for Systems and Innovation Research ISI 2013