Renewable energy groups said January 23 that the European Commission's
proposed renewables targets were ambitious yet achievable. The proposals were
announced January 23 as part of an array of measures designed to combat climate
change.
The European Wind Energy Association said the proposals included two
elements that were crucial for maintaining investor confidence and encouraging
substantial investments in green electricity.
"At this point, [biomass] supply chains are weak. There will be competing
demands."
These were that member states
would keep control of their own support policies, and that cross-border
transfers of guarantees of origin would only take place once member states had
met or exceeded their interim targets.
"By introducing a voluntary trading mechanism, controlled by member
states, the proposal maintains market stability, increases investor confidence
and will help member states to reach their ambitious, yet achievable,
targets," Christian Kjaer, chief executive at EWEA, said.
"They're challenging, but not impossible," Kate Hampton, head of policy
at the London-based investment banking group Climate Change Capital told
Platts.
Though the EU appears on target to achieve its goals for solar thermal
energy, biomass energy generation will have to double to meet the targets, she
said.
Biomass "constitutes such a large part of the overall target that it will
be the most challenging," Hampton said, noting that biomass could be used for
power generation, renewable heat or for meeting the EU's 10% biofuels
objective.
"At this point, supply chains are weak. There will be competing
demands," she said.
EU member states have made a striking shift in the past few months, she
said, from complaining that proposed renewables goals were unachievable to
finding ways to meet them. "It's a political sea change in acceptance of
targets," Hampton said.
Preben Maegaard, president of Denmark's World Wind Energy Institute,
called the EC document "a very ambitious and important directive."
Countries that have just begun to work toward meeting their EU targets
need to accelerate their development, and "for countries well on their way,
there's a need to do even more," he said. "It's a proper judgment by the
commission."
The directive paves the way for decentralized energy solutions, Maegaard
said, and moves away from centralized energy production at large power plants
and refineries. "Renewable energy requires new structures of production and
new types of investment," he said.
Industry group the European Chemical Industry Council said that while it
"acknowledged" the will to push for renewable energies, it was concerned over
"a negative side-effect on electricity prices and limited access to raw
materials."
"The chemical industry therefore fears a rise of its production costs the
whole economy would have to suffer from," it said.
UK business secretary John Hutton said the UK was already looking at a
"vast expansion of wind energy offshore and tidal power on the Severn," and
was "thoroughly reviewing our strategy to drive progress further."
But Andrew Perkins, a director in Ernst & Young's renewable energy team,
said that while the renewables targets were "in principle" a positive step,
fulfilling them in the UK would be a huge challenge.
"Further changes will need to be announced over and above the recent
Energy Bill. The government needs to address the lack of clear legislative
drivers for the renewable heat industry, which if harnessed sufficiently,
could supply a significant proportion of the UK's energy needs," Perkins said.
However, the Ernst & Young director also said that financing the new
projects would not be insurmountable.
"Funds will be found to finance this through the global markets, despite
the limitations brought about by the credit squeeze," he said.
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