With the EU currently reviewing its renewable energy and climate policy, German and Norwegian experts see more steering from Brussels and a trend towards more market-driven policies in several European countries.
The experts discussed the renewable energy policy mix at a workshop at Litteraturhuset in Oslo, organised by CICERO and the Freie Universität Berlin.
Renewable energy transition is a success
Renewable energy currently stands for a quarter of the electricity production in the EU.
“Looking at these figures, the first phase of the energy transition has been a success. Yet, we have a long way to go in transport and heating,” said Miranda Schreurs, Director of the Environmental Policy Research Center at the Free University Berlin.
She added: “Many member states still depend largely on imported or domestic coal for their electricity. Renewable energy has not replaced coal-fired power. Phasing out coal depends on the future of nuclear energy in Europe.”
New policy in the making
This summer, the Commission will propose a revision of the renewable energy directive. In 2014, the heads of state and government already set the target: by 2030, 27% of the energy mix must come from renewable sources.
“The EU’s ambitions for renewable energy have weakened compared to its previous targets for 2020. The policy signal is weakening,” said Sebastian Oberthür of the Institute for European Studies in Brussels.
“The Commission and a growing group of Member States are concerned that a rapid development of renewable energy is pushing up electricity prices and subsidies, while pushing down the carbon price and putting the EU ETS at risk,” Oberthür added.
The EU’s emission trading system, the EU ETS, is the cornerstone and flagship of the EU’s climate policies, yet has been struggling with a very low carbon price over the last years. Jørgen Wettestad from Fridtjof Nansen Institute tempered hope for a quick surge: “The latest reform, introducing a Market Stability Reserve, went down relatively well with the member states and the market. But afterwards, the carbon price has sunk again.”
“The quest for a high carbon price is like waiting for Godot,” Wettestad concluded.
The empire is striking back
“Economic arguments are gaining influence over climate arguments, among stakeholders and in the Commission,” said Elin L. Boasson, leader of the REMIX research project that investigates and compares renewable energy policies in six European countries.
The incumbents have entered the renewable energy market and energy-intensive industries have gained influence in the debate, at the expense of smaller actors from the renewable energy sector.
“At the same time, the Commission has tightened its grip on national renewable energy policies and is steering these in a more market-based direction,” Boasson added.
Increased European harmonisation
Up until now, countries have had different support regimes for renewable energy. While some have market-based solutions like auctions in the UK or green certificates in Sweden and Norway, Germany and Spain have other types of feed-in tariffs.
“A harmonization of policies is happening through the state aid guidelines. Whereas before, support schemes for renewable energy were often exempted, now the European competition authority is more actively enforcing market rules,” said Catherine Banet of the University of Oslo.
Kerstin Tews of the Free University of Berlin fears that a market-driven European renewable energy policy will slow down innovation in the European renewable energy sector.
“Favouring a market paradigm, the Commission does not listen to the needs of these de-centralised actors. Yet these local, small-scale projects are a space where we can experiment with new policies and technologies,” Tews said.
Elin L. Boasson concluded with a positive note: “The current debate is mostly about technical, economic and practical challenges related to boosting the share of renewables. It is not a deep ideological conflict as we had in the past. Actors that used to hate each other now work together and are able to learn from each other.”