Instruments
Developments by the European Union (EU) in support of renewable energy were initiated in 1997 with the Commission White Paper ‘Energy for the Future: Renewable Sources of Energy – White Paper for a Community Strategy and Action Plan’. This paper formulates indicative targets for 12% of total energy consumption to be supplied by renewables in Member States by 2012 based on their own potential. Following the establishment of unique national objectives, strategies are developed in order to achieve them.
White Paper targets were set implicitly recognizing that 5% must be renewable heat. Technology specific targets were set in Annex II of the White Paper as: solar thermal, 100 M m2 by 2010; biomass, 5 652 PJ by 2010; direct geothermal heat 9 TJ and geothermal heat pumps (GHPs) 9 TJ also by 2010. The White Paper also contains a strategy and action plan towards these goals. Although technology specific targets were outlined in the White Paper, they were never included in the EU legislation. It has been estimated that the renewable contribution to the total primary energy supply is unlikely to be met. Based on current trends the EU will not exceed 10% by 2010 (EC, 2007a).
The Buildings Directive (2002/91/EC) targets energy performance in buildings through minimum efficiency standards for new buildings and a new system of certification. Member states are advised to examine the feasibility of alternative energy systems including CHP, district heating, and heat pumps.
The EU CHP Directive (2004-8 EC) for the promotion of cogeneration based on a useful heat demand in the internal energy market provides a range of measures to promote CHP, aiming in the short term to support existing installations by creating a level playing field in the market. It creates a framework for a scheme of guarantees of origin of CHP electricity. In addition, it requires that Member States ensure transparent, non-discriminatory access to the electric grid. Guidelines for the implementation of this Directive are established, and Member States must report regularly on their actions and progress in supporting CHP.
In January 2005 the European Union Emissions Trading Scheme (EU ETS) was established as the first multi-national emissions trading scheme in the world. CO2 emissions from energy-intensive companies are limited, or capped and companies which emit less than their allocated amount of allowances may sell credits to companies which exceed their limits. Companies are thereby offered an incentive to invest in projects which limit their CO2 emissions. The EU ETS therefore acts indirectly to support renewable heating markets, especially biomass heat.
The EU Biomass Action Plan (COM(2005) 628 Final), adopted in December 2005, proposes actions to increase bioenergy deployment in heat, electricity, and transport. Designed to increase the contribution of energy from forestry, agriculture, and waste materials in EU Member States, the plan set targets to double biomass heat production by 2010 to 3 140 PJ. When the plan was adopted in 2005, the EU supplied 4% of its energy needs from biomass.
The European Parliament adopted a resolution[99] in February 2006 asking the European Commission (EC) to table a Directive Proposal to promote renewable heating and cooling. The EC responded by initiating an impact assessment of different options for a renewable heating and cooling directive. A specific proposal for heating and cooling was not included in the 2007 Energy Climate Change
Package. However, in March 2007 the European Commission agreed on 20% binding targets of the EU’s overall energy consumption to be supplied by renewable energy by 2020 as part of the Renewables Roadmap. Although no specific targets were set for electricity and heat, a binding minimum target of 10% was established for transport fuels to be supplied with biofuels. The Roadmap states that in order to meet the 2020 target, the contribution of renewable heating and cooling could more than double, compared with the current share of 9%. Most of this could come from biomass and will involve more efficient household systems and highly efficient biomass-fired CHP with smaller contributions from solar thermal and geothermal. Differentiated national targets are to be derived for individual Member States (EC, 2007a).
Evaluation
The total estimated heat demand in the EU was 16 517 PJ in 2003 and is growing at an average rate of 1.9% annually (Ecoheatcool, 2006). About 40% of the heat demand originates from industry, 42% from the residential sector, 14% in the service sector, and 4% in agriculture (Figure B35). The gross renewable heat generation has increased since 1995.
Figure B35 • Heat demand by sector in European Union Member States
Residential 42%
Industry 40%
Source: EcoheatCool, 2006.
Solar thermal
Although Europe accounts for 10% of the worldwide market and growth is occurring (Figure B36), solar thermal heat accounted for only 0.2% of the heat market in 2006 (EC, 2007). In addition to domestic SHW deployment, there are 87 large scale solar thermal collectors in Europe with a total installed capacity of 120 MW. The largest plants are in Denmark (13 MW) and Sweden (7 MW).
By 2005, 16 Mm2, or 11.2 GW of solar hot water capacity had been installed, with most development in Cyprus, Malta, Greece, and Austria (Figure B37).
Although several directives may have provided indirect support for solar thermal, the EU White Paper was the only one to set technology specific targets. Despite increases in solar thermal markets across the EU, especially in Germany, Austria, and Greece, the target of 100 Mm2 of solar thermal surface area by 2010, as established in the White Paper of 1997, is unlikely to be met. The surface area installed has increased from 6.5 Mm2 in 1995 to 9.6 Mm2 in 2000 and to 14 Mm2 by 2005 (ESTIF, 2006c). Therefore, to reach 2010 targets would necessitate 17.2 Mm2 of solar thermal panels being installed across the EU annually beginning in 2006.
18 000 000 16 000 000 14 000 000 12 000 000 10 000 000 8 000 000 6 000 000 4 000 000 2 000 000 0
 |
Figure B37 • Share of total heat market by solar thermal in EU Member States
Source: EC, 2007.
Biomass
Most renewable heat is generated from biomass (Figure B38), but with wide ranging shares across member states (Figure B39).
Wood chips and pellets accounted for 5.7% of renewable heat generation in 2006 (EC, 2007). Most of the biomass market growth was in Germany with 71.1 PJ added between 2004 and 2005.
The first EU directive to influence the growth of the biomass heat market was the White Paper with biomass specific targets. Other directives such as the EU ETS may have had indirect influence, for example by granting biomass heat eligibility from CO2 reduction measures. The 2005 Biomass Action Plan was the first concrete support offered at an EU level. Despite increasing national initiatives in support of bioenergy, likely to have been influenced by EU Directives, it is unlikely that the 2010 targets for bioenergy will be met.
[1] As defined in IEA Solar Heating and Cooling Task 33 (http://www. iea-shc. org/task33).
[2] See for example www. solarwall. com/home
[3] Demonstration projects have shown that it is possible to meet 90% of domestic heat demand using solar thermal if large scale seasonal storage technologies are used.
[4] Data for Australia, Barbados, Brazil, Cyprus, India, Ireland, Israel, Macedonia, Taiwan and South Africa were not available for 1999. Data for Estonia, Hungary, Malta, Slovenia, Sweden and Poland have only been available since 2002; Latvia, Lithuania, Luxemburg, Czech Republic and Slovak Republic data since 2003.
“Europe” is EU 27 plus Switzerland, Norway, Albania, Macedonia, oversea departments of France.
“Others” are Barbados, Brazil, India, Israel, Mexico, Namibia, South Africa, Tunisia, Turkey.
[5] Here “Europe” is EU 27 plus Switzerland, Norway, Albania, Macedonia, oversea departments of France. “Others” are Barbados, Brazil, India, Israel, Mexico, Namibia, South Africa, Tunisia, Turkey.
Typically carrots act to entice a customer into utilizing RES to meet local heating needs and aims to address the cost gap between RETs and conventional technologies used for either direct or indirect heating. Such incentives schemes may be further categorized into:
[7] The currency used is country specific.
[8] Reliable budget data was available for less than half of the policies surveyed.
[9] The installed surface area increased from 1.1 m2/1 000 inhabitants to 16.5 m2/1 000 inhabitants in Barcelona between 2000 and 2005.
[10] Ex-ante incentives are those which require action prior to the installation of a renewable unit. Ex-post incentives allow actions for incentives to follow installation. Ex-ante incentives are forward looking; ex-post incentives are backward looking.
[11] Annual solar thermal installations in France in 2000 were 23 500 m2, 12 000 m2 in 2001,27 000 m2 in 2002, 38 900 m2 in 2003, 52 000 m2 in 2004, increasing to 121 500 m2 in 2005 following the shift to tax incentives.
[12] No relevant example could be found within the timeframe of the project for a stick-based policy in support of geothermal.
[13] The German EcoTax implemented in 1999 places a tax on conventional fuels for transport and electricity generation.
[14] In the first 4 months of 2006, applications for collector area averaged 11.4 m2 of collector area per system, up from 10.1 in 2005 and 9.7 in 2004 (ZSW, 2006).
[15] A charge was also employed on emissions of nitrogen oxides (NOx) in 1992. Biomass was not exempted from the NOx charges but only negligible effects result so they are not discussed in detail. In addition, taxes have also been employed on electricity consumption.
[16] SEK 30 billion. Currency exchange rate based on average trade value for 2006. 1 SEK = €0.11.
[17] In 2000 it was estimated that 760 000 tonnes of wood fuel was imported into Sweden, equivalent to 14.3 PJ (Ericsson and Nilsson, 2004).
[18] The increased use of energy crops (including coppice Salix) may have been impeded by the common agricultural policy which gives preference to annual food crops over perennial energy crops. Following the implementation of this policy the levels of short-rotation forestry production in Sweden stagnated.
[19] SwissEnergy also aims to reduce the consumption of fossil fuels by 10% by 2010; limit the increase of electricity consumption to 5%; and increase the share of non-hydro renewables in electricity production by 1.8 PJ (0.5 TWh).
[20] Exchange rate: CHF 1 = €0.61.
[21] DKK 0.33/kWh (DKK 1 = ~ € 0.1)
[22] DKK 0.10
[23] Biomass currently accounts for around 38% of heat generated by district heating systems in Denmark (DEA, 2006).
[24] Although most projects subsidized at the beginning of its implementation were for cleaner air and waste prevention, a majority of the budget has since been shifted toward renewable energy projects (approximately 90% in 2005, and 96% in 2006).
[25] The Austria Solar Association runs the programme for private single home owners; the AEE – Institute for Sustainable Technologies, for apartment houses with multiple dwelling units; and a group of Austrian research centres organise professional training and also for the hotel and restaurant industries.
[26] Ground-source heat pumps were supported under the market development pillar, but were not eligible for financial support under the market stimulation pillar.
[27] In the first two cycles CAD 6.2 million of REDI funding had leveraged CAD34.5 million
[28] Wood is used for primary or secondary residential space heating in roughly 3 million households in Canada. This equals roughly 90-100 PJ of annual energy production.
[29] This is an equivalent to €5.85 M per annum or €0.18 per capita per year.
[30] In 1988 the budget was SEK 150 million. This was increased to SEK 750 million per year from 1991-1998. From 1998-2002 it was decreased to SEK 100 Million.
[31] Exchange rate 1 RMB= €0.097.
[32] Solar radiation rates in Germany average only 4000MJ/m2/year and in Japan 4500MJ/m2/year.
[33] In provinces such as Yunnan where coal and gas are unavailable, solar is the only abundant energy resource (Xiao et al, 2004).
[34] With a population of over 1.3 billion, China has become a global manufacturing centre with exports totaling €726 billion/year.
[35] Deployment of low temperature solar dryers (below 70°C) primarily used for agricultural purposes has begun. However in 2004 only approximately 15 000 m2 were in use.
[36] Additional targets set by the Renewable Energy Law include an increase in primary energy from renewables target to 16% by 2020.
[37] Currency exchange rates of NZ$1=€0.54 were used based on 2007 values.
[38] PJ heat values were calculated from heat use percentages and total heat demand as reported by Orkustofnun (2006a).
All data in the overview (Table A10) are based on estimates by GIA (Mongillo, 2007). Costs by 2030 might have come down to €15.4 /GJ (range €2.2 to 69 /GJ) for heating and €15 /GJ (range €1.8 to 89 /GJ) for cooling, mainly due to expected lower investments and increased coefficient of performances (COP). Based on the assumptions used, average costs appear reasonable, but the maximum costs seem high.
[40] Assumed geothermal heat pumps only and higher COPs for future technologies.
[41] Assumed 1200 hrs/yr for USA; 2000 hr for Europe; 2 800 hr for northern Europe and Canada.
[42]Covers worldwide systems for the base year 2005, and projected relative differences by 2030. Neither a reference system nor avoided costs due to fuel savings are incorporated. Installation costs are included but heat distribution costs are not.
[43] See www. oee. nrcan. gc. ca/fbi
[44] 1 Canadian dollar (CAD) = €0.65
[45] The remaining REDI funding was used to form strategic partnerships and alliances, and program management and support.
[46] The government allocated a total of €650 M for climate change initiatives in 2003, a part of which was allocated to TEAM.
[47] http://www. ecoaction. gc. ca/
[48] Wood is used for residential space heating in roughly 3 million households in Canada equaling roughly 90-100 PJ/yr.
[49] 1 Danish krone (DKK) = €0.13
[50] For existing buildings, the obligation takes effect 9 years after the owner of the property has been informed of the regulation.
[51] 9.6 PJ of this total was generated in dedicated biomass plants, 8.4 PJ of which was generated in CHP plants.
[52] A successor policy to the 2000-2006 Wood Energy Plan.
[53] See www. industrie. gouv. fr/energie/developp/econo/textes/credit-impot-2005.htm.
[54] In 2004 the market increased 36% with 78.5 MW (112,147 m2) of new installation bringing the total to 555 MW (792,500 m2).
[55] 115.1 MW (164 389 m2) thermal of new solar thermal capacity was installed in the year 2005.
[56] 430 000 biomass installations were sold in 2005, accounting for this increase.
[57] Greenhouse heating accounts for 2%, and fish and animal farming 1% of the French geothermal energy use.
[58] At the end of 2004, 150 000 French homes utilized geothermal heating technologies.
[59] €1=1.95 DM.
[60] Although the MAP programme is administered by the German Federal Office of Economics and Export Control (BAFA), MAP grants are administered by the Bundesamt fur Wirtschaft and loans by the Kreditanstalt fur Wiederaufbau (IEA, 2004).
[61] This law replaced the 2000 KWK Vorschaltgesetz law on combined heat power.
[62] Solarthermie 2000 during 10 years of operation funded 63 large solar and 7 district heating systems by 2003 (IEA, 2004).
[63] In early 2006, applications averaged 11.4 m2 per system collector area, up from 10.1 in 2005 and 9.7 in 2004 (ZSW, 2006).
[64] Ninety-five percent of available solid biomass in Germany is used for heating purposes.
[65] 9 000 pellet boilers less than 35 kW and 80 large CHP plants were installed between 1998 and 2001.
[66] 2 200 TJ/yr (79%) of low-temperature geothermal heat supply comes from 400 MW capacity of GHPs. The remaining comprises individual space heating, (15 TJ/yr); 89 MW of district heating (589 TJ/yr); and swimming and bathing (106 TJ/yr) (Lund et al., 2005).
67. Equivalent to around 2000 m2 of solar collector area.
[68] .Resulting from an annual increase of 3 500 m2 of installed surface area, or 2.5 MW.
[69] Tax deductions are spread over a period of five years.
[70] Annual mandatory targets of the White Certificate Scheme are monitored by the AEEG.
[71] Direct-use geothermal is also used in individual space heating, district heating, greenhouse heating, fish farming, and industrial process heat.
[72] The energy utilized from the installed capacity is often far less than the maximum potential and may therefore be misleading.
[73] NEDO was established initially in 1980 by the Japanese government to develop new oil-alternative energy technologies.
[74] 1000 ¥ = €6
[75] 7.219 M m2 were flat plate collectors, and 0.141 M m2 evacuated tube collectors.
[76] This reflects an incremental increase of 0.3 M m2 in 2004.
[77] The remaining geothermal heat is used for bathing (11%), greenhouse heating (13%), snow melting (12%), fish breeding (9%), air conditioning/cooling (2%) and industrial process heat (1%) (WEC, 2004).
[78] Exchange rate based on 2002 values when Dutch Guilders (f ) were replaced with the Euro: €1 = /2.20.
[79] 201 877 m2 were flat plate collectors, 2 000 m2 evacuated tubes and 65 235 m2 unglazed.
[80] No data is available on the total installation of deep geothermal capacity in the Netherlands.
[81] 1 Norwegian krona (NOK) = €0.12
[82] See www. husbanken. no.
[83] A total of €70.9 M was allocated for renewable heat in 2001; €4.7 M in 2002; €11.3 M in 2003; €13 M in 2004; and €42 M in 2006. In 2006 59 projects were supported to produce 2.5 PJ of heat.
[84] IDAE is a public business entity, established in 1984, in support of energy efficiency and the rational use of energy across Spain.
[85] Due to the unexpected increase in energy consumption and energy intensity in Spain, the targets for renewable energies established under PFER, set at 12%, were revised.
[86] 2005 budget allocations did not include geothermal heating technologies.
[87] In 2001 the premium paid to small CHP generators was €0.24 /MWh for a maximum of 70% of total annual production (EREC, 2004c).
[88] The annual installation in 2005 was 106 885 m2 or 74.8 MW thermal (EurObserv’ER, 2005).
[89] 1 Swedish krone (SEK) = €0.11
[90] 156 522 m2 were flat plate collectors; 1 704 m2 evacuated tubes and 33 931 m2 unglazed (WEC, 2004).
[91] 1 pound sterling (£) = €1.50
[92] See http://www. defra. gov. uk/environment/energy/communen. htm.
[93] See http://www. lowcarbonbuildings. org. uk/home/.
[94] In 2004, solar thermal generated 266 TJ for domestic hot water (DTI, 2006a)
[95] Total funded-installations in 2006 included 100 biomass boilers with a total capacity of 12 MW and a biomass CHP system with 2.7 MWe and 10 MWth capacity.
[96] Power stations are planned at Lockerbie (43 MW) and Wilton (30 MW).
[97] Clear Skies funding went to 59 domestic projects (25 wood-fuel boilers and 34 wood-fuel stoves) and 61 community biomass projects.
[98] The proposal for a renewable heat obligation has been strongly promoted by the Renewable Power Association and Friends of the Earth.
[99] European Parliament Resolution P6_TA (2006)0058 with recommendations to the EC on heating and cooling from renewable sources of energy
